Pyramid scheme that targeted black communities shut down by feds

An investment scheme that targeted black communities and people who were struggling financially during the pandemic has been shut down and will pay at least $450,000 in customer refunds. The operation was nothing more than an illegal pyramid scheme, the Federal Trade Commission (FTC) said.

The complaint from the FTC and the state of Arkansas accused Texas-based Blessings In No Time (BINT) of scamming people out of millions of dollars starting in June 2020. The operators promised guaranteed returns as high as 800%. In reality, the “vast majority of participants have lost money,” according to the complaint, as generally occurs with pyramid schemes.

Investors had to put in a minimum of $1,400; some invested as much as $62,700. People were told they could earn more by recruiting others to invest, according to the complaint.

There are few financial products, outside of savings accounts and certificates of deposit at FDIC-insured banks, that truly are no risk and have guaranteed returns, the Securities and Exchange Commission says.

Investments are heavily regulated — for a reason.

Consumers lost more money to investment scams in 2022 than with any other type of fraud, the FTC says. In fact, the total losses of $3.8 billion in 2022 was more than double the amount lost in 2021. These include investment opportunities and transactions including annuities, cryptocurrency, pyramid schemes, callable CDs or opportunities touted by people at your church or another group of people you might inherently trust. It also includes companies that offer advice or seminars on investments or any “opportunity” that promises guaranteed returns or says it’s no risk.

You should research any type of investment you’re considering and watch out for warning signs of a scam.

If you have questions about any investment or any broker, you should:
Contact your state’s department of commerce or division of securities.
Or the Securities and Exchange Commission’s Office of Investor Education and Advocacy by calling 1-800-732-0330 or emailing [email protected].
Or you can submit a form on the SEC’s website with your questions.