Home

5/7/2009

Lexington, KY - Bernard Madoff is not the only one with a Ponzi scheme going….with so many people struggling to make ends meet these days with the tough economy, there is a similar activity that's flourishing called "Cash Gifting Clubs"…but your Better Business Bureau warns you they are not all they are hyped up to be!

Joining a "cash gifting" club may sound like the easy way to easy street. These clubs used to just target groups like churches or women's clubs or neighborhood associations and such.

Now you'll find them on the Internet, on different websites. They promise a way to money, cars, a life of luxury….all due to giving and getting cash.

In order to take part, the participant must pay anywhere from $150-$5,000. After making the contribution, which is funneled to people farther up the pyramid, the participant must then convince more people to join in order to start making money themselves.

These promotions promise easy wealth and sound tempting, but your Better Business Bureau warns that cash gifting is not a legitimate way to make money, and is really nothing more than a pyramid scheme.

Recruiters may claim that the operation is legal and often allude to IRS laws regarding gifting. However, almost every state, including Kentucky, has laws outlawing pyramid schemes.

If you are tempted by a gifting club scheme, don't fall for it!

****

Be a "Don’t Fall for It!" informant! If you have something to share you believe may be a fraudulent offer or scam, please let the BBB know! Call us at (859) 259-1008 or toll-free, 1-800-866-6668, or email us at info@bluegrass.bbb.org.