There was a time when Ponzi schemes were localised. A fraudster would open an office and get people in the adjoining areas to invest. Over time, they have gone digital. Now they are done online via websites and mobile apps.
Recently, Delhi police busted one such app scam. The fraudsters used two mobile apps – Power Bank and EZPlan. It worked like a typical Ponzi scheme. The users had to first “invest” money to start earning. Users earned up to 5% returns every day. If an individual “invested” ₹399, the app paid ₹20 daily. Existing members could higher in commissions if they introduce new users – a typical multilevel marketing scheme.
The app became so popular that it was among the most downloaded apps in recent times on app stores.
“In a typical Ponzi scheme, the scammers promise unbelievable returns and high commissions to users. Initially, the payout is as promised, which allow early users to make high returns…