| The person then has to find several other people who will also join the scheme and give cash so the chain continues. The only way that money is made in the scheme is by people giving their cash as they join.
The schemes are called pyramid schemes because there are hundreds of people at the bottom paying cash to join and just a few at the top. The money works its way up to a few people at the top and it's only those people that get the financial benefits.
The scheme would only deliver benefits for those that join at the bottom if there were an infinite number of people also prepared to join at the bottom, which would push those who had joined earlier further up the pyramid. As this won't be the case, sooner or later the scheme runs into trouble and the cash dries up. People who have put money in then lose it and can't get it back.
The Government estimates that up to £100 million a year could be lost by people who respond to bogus promotions.
Postal scams can be very convincing and too many people are fall for their empty promises. Bogus prize draws and competitions and other similar promotions offer unexpected rewards, but simply deliver a hole in the pocket! |