Attorney general warns Idahoans about pyramid schemes

Scammers are always looking for ways to get your money. The attorney general is warning Idahoans about pyramid schemes.

Financial experts say these have been around for more than a hundred years, but now they’re presented in a different way which is why people fall for them.

“Often times pyramid schemes are presented in different ways or presented with different packaging if you will and that makes them more alluring helps I guess tricks people or deceive them into thinking they’re not pyramid schemes,” said University of Idaho extension Luke Erickson.

Gifting circles are the new way these are being presented and they’re targeting women.

“So it kind of plays off empathy women might have for each other and gets them to believe that if they invest a little bit of money, or they don’t even term it as investments they actually term it as a gift, so they say if you gift this money to this group, eventually the world will know that you are a good person and you’ll be paid back in many ways,” Erickson said.

And here’s how these gifting circles work.

“You pay a fee, usually a few thousand dollars sometimes $5,000 to be a part of this group. Once you’re part of this group, the group promises you various things verbally, but in writing they will not promise you anything,” said Erickson.

Watching trusted friends and those who invited you to be a part of this can be enticing.

“Because you’ve seen the quote unquote success happen to those close to you,” Erickson said.

And what happens.

“After time, the pyramid structure will break down because of the exponential growth required for pyramid schemes, they will eventually fail and those at the bottom will lose,” said Erickson.

If you think you are a part of a gifting circle, contact local authorities and the attorney general.

Financial experts also want to remind people that if something seems too good to be true, it probably is.