The COVID pandemic has created economic hardships for many Arkansans. As many seek to ensure they can pay their bills, illegal Ponzi schemes disguised as goodwill gestures, such as so-called “Blessing Looms,” are freely shared on social media that will ultimately steal money from those who fall prey, according to a news release from Attorney General Leslie Rutledge.
“If it seems too good to be true, then it probably is,” Rutledge said. “Blessing looms scams and other Ponzi schemes will ask for you to pay a small amount of money in order to receive a large payout as more people participate. I want every Arkansan to be aware of these schemes so they can keep their hard-earned savings in their wallets.”
Scammers use the “Blessing Looms” scam by posting it on social media and ask unwary readers to pay an entry fee (e.g., $100) with the promise that, as more people pay to build the pot of money by paying the entry fee, the participant will also get a payout (as much as $800) of that money.
The surest way to identify these scams is if they promise large payouts in return for small investments, if they tell factually unsupported “success stories” of happy customers, or if they explain that future results rely on bringing in new participants to the scheme.
Rutledge has identified several tips for Arkansans to use in protecting themselves against Ponzi schemes:
• If something sounds too good to be true, then it probably is. Know that large sums of money generally do not result from small investments.
• Safeguard banking and financial information in order to prevent theft due to scams.
• When using the internet, people should make sure they are using a verified, secure, and encrypted website when sharing any personal or financial information online. Instead of clicking embedded links, consider typing the company’s actual URL website address in the search bar.
• Do not disclose personal information to an unknown person online because it could result in identity theft or the opening of other accounts in their name.
Details: Arkansas Attorney General’s office, 800-482-8982 or oag@ArkansasAG.gov or ArkansasAG.gov.