Montréal - The Autorité des marchés financiers (the AMF) reminds Quebeckers that they should use caution when promised a quick and easy way to make money by recruiting members. The AMF has noticed such offers recently on penny auction sites by companies promoting their binary systems or innovative matrices behind what appears to be a pyramid scheme in disguise.
This activity is Internet fraud similar to pyramid schemes and is called "MMF" (Make Money Fast). In this type of scheme, the money from new members is used to pay existing members, similar to a Ponzi scheme.
The profit promised in this type of scheme is derived from recruiting new members, not from a sales activity. Since no exchange of goods or services takes place, this practice is prohibited under the Consumer Protection Act, the Competition Act and the Criminal Code. An offence may also be committed under the Securities Act if these companies solicit Quebeckers for investment purposes, or issue advertising in this regard, without being registered with the AMF. Such companies and their so-called officers are rarely registered with the AMF.
Don't become a victim of fraud
Whether on the Internet or in person, offering investments is a regulated activity. Any person or company offering investments must be registered with the AMF. Don't become a victim of this type of approach-make sure you check whether the person or company is registered in the register of firms and individuals authorized to practise.
If you think you have detected a scam or been the target of a scam, do not hesitate to contact the Information Centre. Your information could help the AMF better protect consumers.
Visit the AMF website to learn more about how to prevent fraud.
The Autorité des marchés financiers (the AMF) is the regulatory and oversight body for Québec's financial sector.
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Sylvain Théberge: 514-940-2176
Québec City: 418-525-0337
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