Ways to detect fraud in ‘perfect’ investment deal

The allure of reaping high returns or making a quick buck has often snared people straight into the merciless hands of fraudsters. In the last few years, a number of Kenyans have been left licking their wounds after being conned of their life savings by Ponzi scheme architects and other “get rich quick” schemes.

The US Securities and Exchange Commission (SEC) holds that Ponzi schemes are investment frauds promising high rates of return with little risk to investors. The Ponzi scheme generates returns for older investors from proceeds of acquiring new investors.