What is a Ponzi scheme?

A Ponzi scheme is a type of investment fraud that involves taking money from innocent investors and using it to pay promised returns to original investors, rather than investing it in any legitimate asset or activity. These schemes often rely on recruiting new investors to keep the fraud going, as the new money keeps the original investors happy and supports the scheme. In North Carolina, investment fraud law makes it illegal to promote a Ponzi scheme or accept money for such a scheme. Generally, those who are found to be operating such a scheme are guilty of securities fraud, which carries a range of criminal penalties. In addition to criminal penalties, individuals who have been duped into a Ponzi scheme may be able to recover their losses through a civil lawsuit. This is because North Carolina investment fraud law allows investors to recover damages if they can prove that the issuer of the security failed to disclose key information, made false statements, or omitted important information. If you are concerned that you may be the victim of a Ponzi scheme or other type of investment fraud, it is important to contact an attorney who is experienced in North Carolina investment fraud law. An attorney can help you understand your rights and the legal options available to you, as well as help you pursue any recovery or compensation that may be available.

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What is a Ponzi scheme?

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