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Affinity Fraud

Affinity frauds target members of identifiable groups, such as the elderly, or religious or ethnic communities. The fraudsters involved in affinity scams often are – or pretend to be – members of the group. They may enlist respected leaders from the group to spread the word about the scheme, convincing them it is legitimate and worthwhile. Many times, those leaders become unwitting victims of the fraud they helped to promote.

These scams exploit the trust and friendship that exists in groups of people. Because of the tight-knit structure of many groups, outsiders may not know about the affinity scam. Victims may try to work things out within the group rather than notify authorities or pursue legal remedies.

Affinity scams often involve “Ponzi” or pyramid schemes where new investor money is used to pay earlier investors, making it appear as if the investment is successful and legitimate.

Additional Information

Investor Alert: Beware of Pyramid Schemes Posing as Multi-Level Marketing Programs
Investor Bulletin: Affinity Fraud
Investor Alert: Social Media and Investing – Avoiding Fraud
Investor Alert Regarding Web-Based Scheme Targeting Deaf Investors [video]
Stopping Affinity Fraud in Your Community