This type of fraud will be like the victim gets a phone call from the fraudsters and make the customer invest money in some schemes or activities which does not exist. The fraudsters induce the investors to invest their amount in a loss stock in a false belief. Investment fraud involves stock, bond, products or even real estate. They are five types of investment fraud called pyramid schemes, Ponzi schemes, pump and dump, advance fee fraud and offshore scams. In Pyramid schemes, the investors are insisted to invest a small amount and the fraudsters will earn a large profit where there are many investors. Ponzi schemes are the kind where the fraudsters pay the new investors money to the earlier investor and fail to invest the money as promised. In pump and dump the fraudsters purchases share and stock in a very low cost and dump the interest to the investor to pay a huge money.
The investor must pay an advance amount before investing in to a particular scheme so as the amount can be reversed to the investor is known as advance fee fraud. These will come from another country and targets Indian investors because it is very difficult for the Indian investigating companies to investigate the fraud which is happened outside India.
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B.A., B.L., (Hons) IPDP., (London)
Pgd IPR., Pgd Cyber Law., Msc., (IT)
CCI., CFA., IPCL.,
Advocate, Madras High Court
Karthikeyan, is a renowned cyber law expert, who is also the Managing Partner of Law Office of Karthikeyan, a reputed law firm based in Chennai.More About Us