Affinity Fraud: What Investors Need to Know
When a fraudster targets a group of people, we call it affinity fraud. Fraudsters earn the trust of an influential person in a group, then use this connection to get their hands on the money of others in the group. Affinity frauds can happen anywhere, but often occur in religious, ethnic, and community organizations.
Many affinity frauds are Ponzi schemes where money from new investors is used to make payments to earlier investors. Investors may not realize they're part of a scam, so others in the group continue to invest with the fraudster.
If you know of an investment that might be an affinity fraud, contact the BC Securities Commission immediately.