High Yield Investment Programs (HYIP)

High yield investment programs (HYIPs) are investment conduits that allege to yield a high percentage returns on investment and within a very short duration of time. There has been lots of publicity on high yield investment programs as being fraudulent and risky.

High yield investment programs financial performance
High yield investment programs are found all over the internet and can be monitored through high yield investment programs websites such as hyip.com. High yield investment programs offer a daily compound interest at the rate of 1 to 5%, however there are some which offers  rates  in excess of 30% and as high as 140% on a daily basis.

High yield investment programs demand a cash deposit so as to open an account with them and often with differing minimum and maximum deposit prerequisites. They correct the investor’s working capital and manage it through techniques which are not well known and if they make it known; are vague. Many of high yield investment programs operate offshore, out of legal jurisdiction, for example in Sachelles and Anguilla. The invested funds are usually not insured and there is no guarantee that the investor will get their investment returns or accrued interest.

How do you verify high yield investment programs legitimacy?
It is very essential to verify the legitimacy of a high yield investment program, know how it works, after all, if the program is not working, it is not legitimate. To verify its legitimacy, performing the following basic checks will indicate the national laws on which the investment program operates in, its credibility as an investment vehicle, its physical location and licensing information of the business.

The following points will be helpful in identifying legitimate high yield investment programs.

  • Physical address it has been registered to and the internet domain
  • Information regarding its investment product and profile must be shown
  • The business profile information and the nature of investments
  • Registration, licensing with a reputable domestic department or institution like the Securities and Exchange Commission
  • Historical performance of the program and its acknowledged quantitative statistics
  • Accurate information on how and why the programs work

If the high yield investment program is not able to provide adequate information on the majority of the above points, there is a good chance that the program is fraudulent and an investor’s money is not secured as well as that the investment is a hoax. It is important to contact the Securities and Exchange Commission to enquire about companies that raise huge amounts of investment capital before investing.

How are they controlled?
The registration with the Securities and Exchange Commission is a helpful indicator of the viability of the high yield investment program as required by the regulator, and that it should comply with regulations set out by the regulatory body. There may be some similarities between high yield investment programs and the hedge funds in the sense that they don’t always have to register with the Securities and Exchange Commission because:

  • Business partnerships with a limited number of investors
  • Have raised equity below a certain amount of dollars
  • They do not operate within the legal jurisdiction of the United States

In summary, high yield investment programs offer daily interest by compounding this amount to high yield returns on the capital investment. Most high yield investment programs operate online via their website portals and often request money to be transferred to them for an investor’s investment to start yielding. Most of high yield investment companies are not based in the United States of America, thus they don’t follow their laws and regulations as set forth by the domestic regulatory bodies. Therefore they may not be required to insure, guarantee, or report anything that may happen. High yield investment programs are generally considered by majority of market observers as fraudulent capital raising schemes that only benefit their originators. A high level of due diligence may prove beneficial before investing your hard earned money with these programs.

Comments are closed.