What are the most common forms of investment fraud?

Investment fraud can take many forms, but some of the most common in Florida are pyramid schemes, Ponzi schemes, fake investments, affinity fraud, and unlicensed brokers. Pyramid schemes are an illegal form of investment fraud that involves recruiting others to join the scheme, in exchange for a commission. The groups are often advertised as legitimate investments, but participants do not receive any real profits from these schemes. All of the money is paid out to early participants from later investors. Ponzi schemes are another form of investment fraud where investors are promised high returns but never receive any money. The scheme is maintained by taking money from new investors and paying them out to earlier investors in order to keep the scheme going. Fake investments are also another form of investment fraud, where people are promised returns on investments, but the money is never actually invested. The fraudsters often create fake documents to make it appear as if their investments are legitimate. Affinity fraud is when an individual or group of people exploits the trust of a particular group of people (e.g. a church or social group) to defraud them out of their investments. The fraudsters often create strong emotional connections with their victims and use that trust to scam them. Finally, unlicensed brokers can be another source of investment fraud. These people often promise high returns on investments, and may not be properly qualified or experienced. They can also act recklessly and make risky investments that leave their clients with large financial losses.

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