* A pyramid scheme is a form of fraud similar in some ways to a Ponzi scheme, relying as it does on a disbelief in financial reality, including the hope of an extremely high rate of return. However, several characteristics distinguish pyramid schemes from Ponzi schemes:

       * In a Ponzi scheme, the schemer acts as a “hub” for the victims, interacting with all of them directly. In a pyramid scheme, those who recruit additional participants benefit directly (in fact, failure to recruit typically means no investment return).

       * A Ponzi scheme relies on some esoteric investment approach, insider connections, etc., and often attracts well-to-do investors; pyramid schemes explicitly claim that new money will be the source of payout for the initial investments.

      * A pyramid scheme is bound to collapse a lot faster, simply because of the demand for exponential increases in participants to sustain it (Ponzi schemes can survive simply by getting most participants to "reinvest" their money, with a relatively small number of new participants).

- No SEC registration
- Investment in foreign currency, preferrably in US Dollars
- Offers or guarantees a huge profit in a short period
- Utilizes a binary network (i.e., upline and downline) to earn commissions
- No paper trail (i.e., contracts, receipts)
- Promises little or no financial risk
- Provision for a lock-up period where investors cannot touch the money for a fixed period (i.e., 60 days)
- Assures pay-off of investments in a short time
- uses high pressure methods to convince investors to reinvest their earnings
- Unknown principal office, address, founders, directors or officers
- Orientation seminars are conducted informally