Get-rich-quick scheme
Encyclopedia
A get-rich-quick scheme is a plan to acquire high rates of return for a small investment
. The term "get rich quick" has been used to describe shady investments since at least the early 1900s.
Most such schemes promise that participants can obtain this high rate of return with little risk
, and with little skill, effort, or time. Get rich quick schemes often assert that wealth
can be obtained by working at home. Legal and quasi-legal get-rich-quick schemes are frequently advertised on infomercial
s and in magazines and newspapers. Illegal schemes or scams are often advertised through spam
or cold calling
. Some forms of advertising for these schemes market books or compact disc
s about getting rich quick rather than asking participants to invest directly in a concrete scheme.
It is clearly possible to get rich quickly if one is prepared to accept very high levels of risk — this is the premise of the gambling
industry. However, gambling offers the near-certainty of completely losing the original stake over the long term, even if it offers regular wins along the way. Economic theory states that risk-free opportunities for profit are not stable, because they will quickly be exploited by arbitrage
urs.
The scheme will usually claim that it requires no special IT or marketing skills and will provide an unrealistic timeframe in which the consumer could make hundreds of thousands, if not millions of dollars.
Schemes of this nature usually have catchy titles and images associated with wealth and luxury to encourage potential victims into paying signing up fees which can range from several dollars to thousands of dollars. The get-rich-quick scheme will heavily imply that the consumer will be able to earn much more than this small investment when they apply the special, secret techniques revealed in their training material they will send. Such training material is typically in the form of e-books or training CDs.
These schemes rarely work since the material sent to victims is frequently just basic or intermediate marketing material that is neither secret nor a guarantee to making a lot of money online.
Get-rich-schemes of this nature habitually share the same warning indicators that include, but are not limited to:
Another indicator is the way the schemes are advertised. Many schemes will post so-called “success stories” on post-your-own-article websites.
Schemes like this will also be advertised through serial promoters. Serial promoters are individuals who are not directly affiliated with a given scheme, but will promote from one to the next almost everyday. In return the owner of the scheme may do the same for them, or if the get-rich-scheme is a Ponzi scheme, the serial promoters will be invited to join early in order for them to make money from new recruits.
Although Affiliate marketing is a genuine method of income , Get rich schemes make outrageous claims in order to lure people in.
An example of such products include the infamous Google
scams, where the scheme will imply that viewers can make an income from home using affiliate advertising with Google, or simply posting links. These schemes have various titles and will trick the user into thinking they are endorsed or affiliated with Google Inc. through improper use of trademarks and logos.
Other popular online get-rich-quick schemes can include survey taking, whereby a user would complete surveys of varying subjects and get paid for the time. Get-rich-quick schemes take advantage of this and often promise that users can make a good income from doing this, which is not the case. Individuals who partake in survey taking can expect small profits that can supplement another full time income.
A different tack is taken by online "Clairvoyants" who offer to untangle psychic or ethereal blocks to wealth, for a one off or ongoing fee. Each has a different pitch but buying lucky talismans, obtaining lucky numbers for lotteries, or performing wealth attracting rituals often feature. Several such "Mystics" under different aliases operate from Rambouillet near Paris.
The legality of such schemes is often a matter of extreme controversy. This online get-rich-quick scheme can’t be described as illegal outright scams since the majority do send an end product to the user, but they do employ severely misleading sales tactics in order to get victims to sign up. Users should always be aware when signing up for schemes online that promise to show the route to financial freedom, especially if there is an initial investment
to be made.
Investment
Investment has different meanings in finance and economics. Finance investment is putting money into something with the expectation of gain, that upon thorough analysis, has a high degree of security for the principal amount, as well as security of return, within an expected period of time...
. The term "get rich quick" has been used to describe shady investments since at least the early 1900s.
Most such schemes promise that participants can obtain this high rate of return with little risk
Risk
Risk is the potential that a chosen action or activity will lead to a loss . The notion implies that a choice having an influence on the outcome exists . Potential losses themselves may also be called "risks"...
, and with little skill, effort, or time. Get rich quick schemes often assert that wealth
Wealth
Wealth is the abundance of valuable resources or material possessions. The word wealth is derived from the old English wela, which is from an Indo-European word stem...
can be obtained by working at home. Legal and quasi-legal get-rich-quick schemes are frequently advertised on infomercial
Infomercial
Infomercials are direct response television commercials which generally include a phone number or website. There are long-form infomercials, which are typically between 15 and 30 minutes in length, and short-form infomercials, which are typically 30 seconds to 120 seconds in length. Infomercials...
s and in magazines and newspapers. Illegal schemes or scams are often advertised through spam
Spam (electronic)
Spam is the use of electronic messaging systems to send unsolicited bulk messages indiscriminately...
or cold calling
Cold calling
Cold calling is the marketing process of approaching prospective customers or clients, typically via telephone, who were not expecting such an interaction...
. Some forms of advertising for these schemes market books or compact disc
Compact Disc
The Compact Disc is an optical disc used to store digital data. It was originally developed to store and playback sound recordings exclusively, but later expanded to encompass data storage , write-once audio and data storage , rewritable media , Video Compact Discs , Super Video Compact Discs ,...
s about getting rich quick rather than asking participants to invest directly in a concrete scheme.
It is clearly possible to get rich quickly if one is prepared to accept very high levels of risk — this is the premise of the gambling
Gambling
Gambling is the wagering of money or something of material value on an event with an uncertain outcome with the primary intent of winning additional money and/or material goods...
industry. However, gambling offers the near-certainty of completely losing the original stake over the long term, even if it offers regular wins along the way. Economic theory states that risk-free opportunities for profit are not stable, because they will quickly be exploited by arbitrage
Arbitrage
In economics and finance, arbitrage is the practice of taking advantage of a price difference between two or more markets: striking a combination of matching deals that capitalize upon the imbalance, the profit being the difference between the market prices...
urs.
Illegal get-rich-quick schemes
- When there is no pretense at selling a product, many get-rich-quick schemes qualify as pyramid schemePyramid schemeA pyramid scheme is a non-sustainable business model that involves promising participants payment or services, primarily for enrolling other people into the scheme, rather than supplying any real investment or sale of products or services to the public...
s or matrix schemeMatrix schemeA matrix scheme is a business model involving the exchange of money for a certain product with a side bonus of being added to a waiting list for a product of greater value than the amount given...
s, which are illegal in many jurisdictions. - Ponzi schemePonzi schemeA Ponzi scheme is a fraudulent investment operation that pays returns to its investors from their own money or the money paid by subsequent investors, rather than from any actual profit earned by the individual or organization running the operation...
s, which are similar to pyramid schemes and offer exorbitant returns on investment, are also similarly illegal in many jurisdictions. - Advance fee fraudAdvance fee fraudAn advance-fee fraud is a confidence trick in which the target is persuaded to advance sums of money in the hope of realizing a significantly larger gain...
.
Online get-rich-quick schemes
Get-rich-quick schemes that operate completely on the Internet typically promote “secret formulas” to affiliate marketing and affiliate advertising.The scheme will usually claim that it requires no special IT or marketing skills and will provide an unrealistic timeframe in which the consumer could make hundreds of thousands, if not millions of dollars.
Schemes of this nature usually have catchy titles and images associated with wealth and luxury to encourage potential victims into paying signing up fees which can range from several dollars to thousands of dollars. The get-rich-quick scheme will heavily imply that the consumer will be able to earn much more than this small investment when they apply the special, secret techniques revealed in their training material they will send. Such training material is typically in the form of e-books or training CDs.
These schemes rarely work since the material sent to victims is frequently just basic or intermediate marketing material that is neither secret nor a guarantee to making a lot of money online.
Get-rich-schemes of this nature habitually share the same warning indicators that include, but are not limited to:
- They will imply that anyone signing up will become rich within months to a year.
- They will tell potential victims that the route to success is by following “secret formulas” that no one else knows about.
- They will often claim they have been seen on various websites such as Google and YouTube, causing the viewer to assume said websites endorse the product.
- They will use pressuring tactics to get you to sign up quickly, such as claiming that there are only a certain amount of copies of a CD left, or using special discount prices that are only available for a short amount of time.
- Schemes such as this will often employ the tactic of displaying testimonials from “previous users.”
- When trying to navigate away from their website, users are often presented with popup windows offering further discounts, in an attempt to make the user feel special.
Another indicator is the way the schemes are advertised. Many schemes will post so-called “success stories” on post-your-own-article websites.
Schemes like this will also be advertised through serial promoters. Serial promoters are individuals who are not directly affiliated with a given scheme, but will promote from one to the next almost everyday. In return the owner of the scheme may do the same for them, or if the get-rich-scheme is a Ponzi scheme, the serial promoters will be invited to join early in order for them to make money from new recruits.
Although Affiliate marketing is a genuine method of income , Get rich schemes make outrageous claims in order to lure people in.
An example of such products include the infamous Google
Google
Google Inc. is an American multinational public corporation invested in Internet search, cloud computing, and advertising technologies. Google hosts and develops a number of Internet-based services and products, and generates profit primarily from advertising through its AdWords program...
scams, where the scheme will imply that viewers can make an income from home using affiliate advertising with Google, or simply posting links. These schemes have various titles and will trick the user into thinking they are endorsed or affiliated with Google Inc. through improper use of trademarks and logos.
Other popular online get-rich-quick schemes can include survey taking, whereby a user would complete surveys of varying subjects and get paid for the time. Get-rich-quick schemes take advantage of this and often promise that users can make a good income from doing this, which is not the case. Individuals who partake in survey taking can expect small profits that can supplement another full time income.
A different tack is taken by online "Clairvoyants" who offer to untangle psychic or ethereal blocks to wealth, for a one off or ongoing fee. Each has a different pitch but buying lucky talismans, obtaining lucky numbers for lotteries, or performing wealth attracting rituals often feature. Several such "Mystics" under different aliases operate from Rambouillet near Paris.
The legality of such schemes is often a matter of extreme controversy. This online get-rich-quick scheme can’t be described as illegal outright scams since the majority do send an end product to the user, but they do employ severely misleading sales tactics in order to get victims to sign up. Users should always be aware when signing up for schemes online that promise to show the route to financial freedom, especially if there is an initial investment
Investment
Investment has different meanings in finance and economics. Finance investment is putting money into something with the expectation of gain, that upon thorough analysis, has a high degree of security for the principal amount, as well as security of return, within an expected period of time...
to be made.
See also
- Forex scamForex scamForeign exchange fraud is any trading scheme used to defraud traders by convincing them that they can expect to gain a high profit by trading in the foreign exchange market. Currency trading "has become the fraud du jour" as of early 2008, according to Michael Dunn of the U.S...
- Make money fastMake Money Fast"MAKE.MONEY.FAST" is a title of an electronically forwarded chain letter which became so infamous that the term is now used to describe all sorts of chain letters forwarded over the Internet, by e-mail spam or Usenet newsgroups...
- Scam
- RipoffRipoffA ripoff is a bad financial transaction. Usually it refers to an incident in which a person overpays for something. A ripoff is distinguished from a scam in that a scam involves wrongdoing such as fraud; whether or not something is a ripoff, on the other hand, is a matter of opinion.In a related...
- TANSTAAFLTANSTAAFL"There ain't no such thing as a free lunch" is a popular adage communicating the idea that it is impossible to get something for nothing. The acronyms TANSTAAFL and TINSTAAFL are also used...
- Land BankingLand bankingLand banking is the practice of purchasing raw land with the intent to hold on to it until such a time as it is profitable to sell it on to others for more than was initially paid...
- Matthew LeskoMatthew LeskoMatthew Lesko is an American author, self-proclaimed federal grant researcher, and infomercial personality. He has authored over 20 reference books telling people how to get "free" money from the United States government...
- Success UniversitySuccess UniversitySuccess University is a multi-level marketing program started by Matt Morris in January 2005. It has also been identified as a pyramid scheme. Success University does not employ any professors and does not have any premises; instead members are offered online courses on topics such as success in...