By definition, a Ponzi scheme uses the investments of later investors to pay "returns" to earlier investors, building confidence in the scheme. There's been no reports of any investors getting a return. So this was pretty straightforward fraud. "give us your money!"
So far, the only specifics I've seen are three anecdotal accounts from scamees, only one of whom ever asked for some money back (not all of it with interest), and he did get it. So clearly, they did have some provisions in place for people who wanted to take money out. It's true that a classic Ponzi usually starts out by paying back some early scamees, with interest, to create some positive word of mouth. But at the same time, it is vital to a Ponzi scammer that the percentage of people who want their money back is kept as close to zero as possible. Absolute zero is the ideal scenario. The scheme always collapses when that percentage becomes too high. So no, I don't agree that something only becomes a Ponzi the moment the first repayment goes out. It's how they would deal with a scamee who wanted his money with interest that counts, even if no such request ever comes during the (usually quite brief) lifetime of the scheme.
The description of a Ponzi as a scheme were early investors are paid back with the money from later investors, which is invariably inserted in every article on the subject, also isn't correct, IMO. All money put in goes into one pot, and that pot is used to pay back the small number of people who ask for it. When they joined is immaterial. Very often, the people who end up with the biggest losses when the Ponzi collapses were among the earliest participants, who were content to just look at the ever-increasing numbers on their statements but never tried to cash in, while later arrivals may have gotten their money plus interest back in time.
If you read the "victim" reports in this case, they were "reading" the results of the investments on the website and believing them.
It's known in sales that if somebody reads something they're more likely to believe it than if you tell it to them. It may be because when you read you hear their own voice saying it. In the past getting "published" was hard, it usually went through some filters, so there may have been some efficacy in accepting the published word (or image)
That may have been true once upon a time, but I wonder if it still holds. Why do so many scam peddlers of all kinds (and I don't just mean financial ones, but conspiracy theorists, pseudo-historians and the like) seem to be addicted to video clips of talking heads, mostly on Youtube, when they could as well have written out the text in those time-wasting clips? Hell, even my bank just started sending me links to a video clip, which is just the standard quarterly report about investment portfolios, but read out in front of a camera by someone, with the same (mostly pointless) graphs inserted that are in the written-out version. Clearly, they believe they have investors who can't deal with that information on paper (or on a screen), but want a moving talking head instead. It means that something I can easily read in less than a minute now has a video version which takes nearly nine minutes to watch.
Something to add: these secureinvestments.com guys clearly got around, because besides the basic scam, they also tried to bolt on a pyramid, MLM-type scheme. According to
this PR release:
“While big investors are getting rich fast, small investors can make the same returns by referring new clients under their accounts. By introducing our services to your friends you will receive beneficial partnership commission of two to three per cent. This kind of payment can quickly add up for an individual,” said the spokesperson.
[...]
“Our partnership program has two levels with larger percentage rewards on the second level, to add extra encouragement to the investors down the line. We also offer outstanding compensation based on volume or referrals,” said the spokesperson.
And as to people trusting in what they can read: clearly none of these "victims" ever bothered to do anything as simple as googling on just the name of the website and reading some of the stuff that comes up. For as long as they have been active, there were tons of websites were they were being discussed, and where overwhelmingly people were pointing out what a painfully obvious scam it was. I loved one post by a guy who'd bothered to go and take a look at the claimed corporate headquarters in Panama. It was a real office building with rental units alright, but they were unknown there.
