The Ontario Provincial Police is warning Essex County residents about a Ponzi-style investment scheme that is making the rounds.
Leamington OPP started investigating in January after a victim lost $109,000 in an investment scam related to a business selling alcohol.
Police say the scam gains the victim's trust by asking them to invest and promising a return on the investment. The scammer then tells the victim to tell his friends and family about the scheme in hopes of luring more investors.
The scam offers victims a higher-than-normal return. In reality, the scammers are paying early investors with money taken from new ones. Eventually, these scams always collapse, leaving victims out thousands of dollars.
Police recommend always approaching a new investment proposition with skepticism. They say never put your money into a proposal if you don't fully understand how it works, and ask a lot of questions. Verify that the organization you are dealing with is legitimate, and remember, unsolicited phone offers are usually a red flag.
If you suspect you were approached by a scammer, or you're a victim of fraud, report it to police and the Canadian Anti-Fraud Centre's online reporting system or by phone at 1-888-495-8501.