In the past, it was known that ebay scammers used to sell many cheap items just to gain a high reputation, before ripping off buyers on a more expensive product which the seller does not own. It is basically a way of gaining high reputation with low cost and quickly, just to gain the trust of buyers.

It is similar to some investment scams (or even Ponzi systems) that promises high returns such as High Yield Investment Program (HYIP). In most cases, people tend to be greedy but are afraid of being ripped off. So they will invest a small sum to ‘test’ if the investment really works as promised. For the small sum of investment, the scammer may issue the promised returns just to gain the trust of the investor. After perhaps one or several rounds of success, the investor would feel confident about the program and either borrow more money, get their friends and family involved, or even dump their lifetime savings into the investment. That is when the scammer would rip off the investor and run away with the money. 

Some websites have gone to the extend of indicating which HYIP listing works, and which are scams. However, we doubt most HYIP would work as the promised high returns with low or no risk, which contradicts the fact that high returns would equate with higher risk. There is no free lunch and trying to be a banker yourself is a risky business if you are not a professional investor. In some cases, the HYIP may simply vanish after collecting your cash, whether US$10 or US$1,000, without a single return. Hence, do not even think about ‘countering’ such scams by aiming to take profits from the ‘initial’ investment, and assuming that it is a bait for bigger rip-off. They may simply walk away with that US$10 of yours, after say, one month. Assuming that during that month, 1,000 investors like you sign up for the program, the scammer will get $10,000. This is good enough for some to run away.

Read This

Believe or not, people are still wasting precious bandwidth on the internet (not by spaming) by doing the usual ‘check the forums’ about a particular HYIP. If you are lucky, the good guys will be there to reply you. If you are not, the bad guys will be there pretending that they are happy customers of the HYIP and write nice comments about the program. Basically, we believe that there is no such thing as HYIP and it is just a name created to make money from a system.

‘Trust’ exploitation may appear in different types of scam, some not involving money directly such as medicare scams which try to get the medicare number, affinity scams, modelling scams, and even lottery scams. Some of these scams do not aim to get your money directly, but there are information that you provide which may be useful for them.

Just some recommendations and advise:

1) Never believe in any investment program that promises high returns. Perform a thorough background and documentation check from reliable sources before getting yourself involved. Beware that people may try to convince you to gain your trust.

2) It is recommended not to purchase expensive items on the internet from individuals even if they have high reputation. If the item is expensive, we recommend buying from a reputable company or person. By reputable, we mean one that is recognised publicly and NOT by internet votes and ratings. Other than the ebay scam example as mentioned in the first paragraph, we will publish another short article regarding a website that acts as broker for ‘votes’. Note that we use the term ‘recommend’, as there are many rules which are not covered here.

3) Do not be pressurised or rushed into any investment, simply because the seller is someone whom is close to you, in your community group, etc. Treat it as a business dealing and be ready to say ‘No’, regardless of friends, relatives, affiliation etc. It may be easier to approach you because you are a friend or relative, but you need not dive right in just because of that.