High-Yield Investment Program (HYIPs)

Fraudulent investments that offer extremely high rates of return.

What is a High-Yield Investment Program?

HYIPs use websites to offer extremely high daily, weekly, or monthly rates of return. A HYIP website will have little information about the company’s location, management, or how it invests funds it receives. HYIPs boast about passive income, secure online accounts, and exclusive investment products or savings accounts.

How Does it Work?

Setting up a HYIP is relatively cheap. Operators buy a domain name, design a webpage, and publish it on the Internet. Once it’s live on the Internet, the promoters are in business. Their next step is to attract investors from all over the world.

Sophisticated HYIP sites offer investments in legitimate securities, like commodities, futures, etc. These sites may also offer online accounts with sophisticated e-commerce security, guaranteeing you safe and easy access to your money. Scammers use advertising and positive word-of-mouth, networking through social media or HYIP-rating websites to get the word out to as many people as possible.

When you invest, you will be asked to send your money through a wire service or an online payment system. In the past, some fraudulent HYIPs have purportedly set up their own online payment systems. Once you open an account, you may receive some high-yield payments, or they might show up in your online account. As in Ponzi schemes, the operators are probably sending you other people’s money.

Watch out for one or more of these common characteristics:

  • Websites that offer stocks, bonds, or savings accounts with high rates of return (for example, 2% a day, 14% a week, or 48% a month).
  • Online advertisements linking to a website that offers high-yield investment products or passive, high-yield savings accounts that will make you rich.
  • Websites that rate HYIPs claiming to separate the real ones from the fake ones.
  • Postings in web forums or on social media purportedly from the management of the HYIP that gives technical updates, payment details, etc.