Sentidokomon

By Carmela Bignotia (OFW Guide)

It is but natural for overseas Filipino workers (OFWs) to seek for ways on how to make their money grow. Still, OFWs must be very cautious in dealing with any transaction that requires them to shell out large amounts of their hard-earned cash. Falling into the trap of pseudo-investment schemes like Ponzi and pyramiding is equivalent to wasting years of hard work and sacrifice overseas.

One characteristic of pseudo investment schemes like Ponzi and pyramiding is that they both offer quick cash to unsuspecting investors. Ponzi investment scheme looks promising at first because an investor will initially receive high interest made possible by the money deposited by other investors. An investor will then be encouraged to deposit larger amounts of money hoping to earn more. However, the true earner in pseudo investment schemes is the operator. A pyramid scheme is multi-level marketing program that does not market a product or service. Members of the pyramid scheme are encouraged to recruit new members to earn more.

Ponzi and pyramiding are considered illegal because both investment strategies are doomed for failure from the start. The operation cannot support itself because the income generated in Ponzi and pyramiding are solely dependent on the money deposited by the members.

Many Filipinos have been victimized by these scams that a guideline on how to avoid it is necessary:

Warning Signs

It offers quick cash. The scheme sounds too good to be true as it advertises that it is an opportunity where one can get rich fast. It promises quick and high returns for a small investment. It demands payment. New members are required to pay a certain amount.

It requires you to recruit other members. The scheme promises to give commissions for every individual that you will convince to join and invest.

It requires you to purchase a certain product. To earn from the scheme, you have to pay an expensive product or marketing materials.

Reminders

Do not pay for anything or sign any contract without fully understanding of what you are getting yourself into.

Check the credibility of the company where you will invest your money by checking if it is registered in the Philippine Securities of Exchange and Commissions.

Be suspicious of any investment that does not have any detailed information about the company and how the investment works.