FCA Exposes Ponzi Scheme Gainmax Capital

The UK financial regulator, the Financial Conduct Authority, is frequently issuing warnings about companies that are acting against the interests of the consumer. Earlier today, the watchdog highlighted another one, called Gainmax Capital.

The website of Gainmax Capital looks like a classic Ponzi Scheme Ponzi Scheme A Ponzi scheme is a scam that looks to lure investors, ultimately paying profits to earlier investors with funds from more later investors.This form of fraud tricks victims into believing that products are instead generated from product sales or other means. In actuality, most investors are completely oblivious to the actual origin of incoming funds.One of the central attributes of a Ponzi scheme is the necessity of its ongoing nature, which is dependent on a steady flow of new contributions and A Ponzi scheme is a scam that looks to lure investors, ultimately paying profits to earlier investors with funds from more later investors.This form of fraud tricks victims into believing that products are instead generated from product sales or other means. In actuality, most investors are completely oblivious to the actual origin of incoming funds.One of the central attributes of a Ponzi scheme is the necessity of its ongoing nature, which is dependent on a steady flow of new contributions and Read this Term, promising guaranteed returns to users that sign up for an account with the firm. According to the information presented on the website, the firm guarantees monthly profits on trading commodities, currencies and stocks.

Classical Ponzi Scheme Attributes

In a particularly worrying section of its website, Gainmax Capital claims that clients who invest bigger amounts will get bigger returns. A table with tiered returns on investment reveals an overblown percentage return from 5% for depositors of up to $250, to 10% for those who commit above $10,000.

The tiers are also tied to a minimum term with the biggest amounts requiring 5 weeks, while the smallest investors have to commit to 20 weeks. The company’s Youtube channel has testimonials from what are stated to be random users, some of whom are claimed to be based in the US.

The presentation of the company on the site is made by a person with an Eastern-European accent, who claims that the firm is based in London. Gainmax Capital is also offering a classical multi-level Marketing Marketing Marketing is defined as the business process of identifying, anticipating and satisfying customers' needs and wants.This is a crucial element of any operation or brokerage in the financial services space. Well-funded marketing campaigns are instrumental to the survival and longevity of these companies in an increasingly competitive industry.Within the forex space, marketers perform a wide range of functions to help procure, secure, or retain clients.In particular, newer forex brokers also have t Marketing is defined as the business process of identifying, anticipating and satisfying customers' needs and wants.This is a crucial element of any operation or brokerage in the financial services space. Well-funded marketing campaigns are instrumental to the survival and longevity of these companies in an increasingly competitive industry.Within the forex space, marketers perform a wide range of functions to help procure, secure, or retain clients.In particular, newer forex brokers also have t Read this Term scheme, where people who refer others to the Ponzi scheme get higher returns on their investments.

The FCA's Continued Fight Against Fraud

The FCA has been active in issuing alerts related to companies that misrepresent themselves as entities that are based in the UK. From binary options to fake brokers, boiler rooms, clones and Ponzi schemes, the watchdog has been posting warnings on its website for many years.

The main issue with the warnings is that they are usually too late. In the case of Gainmax Capital, the video that depicts a person that is allegedly a financial expert from the firm is posted on Youtube in June 2017. Since then the company’s channel posted several more videos, the latest of which dates to February this year.

The FCA’s warning appears to be the first official warning against the company.