Here is the rewritten article in markdown format:

Types of Financial Fraud in Fiji: Pyramid Schemes and Community Gifting Circles

August 20, 2021 - The Consumer Council of Fiji is warning consumers to be cautious of pyramid schemes and community gifting circles that are flooding the market with false promises of high returns. These scams have been on the rise in recent months and are often disguised as legitimate businesses.

Pyramid Schemes: A Business Model Built on Lies

A Pyramid Scheme is a business model that makes money by recruiting new members to join the scheme. New members are required to pay a fee, which ranges from $20 to hundreds of dollars, and are promised high returns. The scheme relies on recruiting more members to make profits, rather than selling actual products or services.

Here’s how it works:

• A few top-level members recruit newer members, who in turn recruit their own members, creating a pyramid structure.
• However, this business model is unsustainable, as the prospective member pools tend to dry up over time.
• When the scheme inevitably shuts down, the top-level operatives walk away with loads of cash, while the majority of lower-level members are left empty-handed.

Community Gifting Circles: Another Disguise for Pyramid Schemes

Community Gifting Circles are another form of pyramid schemes that have been used in Fiji to fleece unsuspecting consumers. These circles often masquerade as legitimate businesses or community projects and promise high returns with little effort required.

Gifting circles can take many forms, including:

• Investment opportunities
• Community projects
• The chance to be your own boss

However, despite their claims, these circles are still pyramid schemes that rely on recruiting more members to make profits.

Red Flags: Be Cautious of These Scenarios

Consumers should be wary of the following scenarios:

• Ask where the amounts you could receive will come from. If revenues are based only on member recruitment, that is illegal.
• You have been promised a big profit for little or no effort. It’s too good to be true.
• You may be encouraged to use a fake name to participate. However, using your real name does not mean it’s not a pyramid scheme.
• You are asked to pay in cash or direct transfer via online modes.
• You are strongly advised not to miss out on this opportunity. Your emotions are being manipulated.

Council Tips: How to Avoid Falling Victim to Pyramid Schemes

To reduce the chances of falling for this type of fraud, consumers should:

• Do not be taken in by fancy words or web testimonials or offers that seem just too good to be true.
• Be careful if someone promises you money to recruit new people, whether they refer to them as investors, partners, associates, or by some other term.
• The people who orchestrate pyramid schemes and those who participate in them may be prosecuted.
• Do not be fooled because someone told you that it’s legal, that a loophole in the law makes the operation legal, or even that a government official has approved it. All of these statements are false!
• Always check whether the person and firm offering you an investment are authorized to do so. When in doubt, contact the Council on toll-free number 155 or email complaints@consumersfiji.org.

The Consumer Council of Fiji is urging consumers to be cautious and vigilant when approached with investment opportunities that seem too good to be true. If you have any doubts or concerns, please reach out to us for assistance.