5 Signs Your Surefire Hedge Fund Investment Is A Ponzi Scheme

Jan 2 2015 | 6:25am ET

5. Roadblocks are put up when you attempt to withdraw money.

Thomas Petters, who is serving a 50-year sentence for running a Ponzi scheme based on the purported purchase of electronics for sale to big-box retailers, would go to great lengths to avoid paying investors, employing “delay and evasion tactics, such as promising payments in the future, making up excuses about slow payments from retailers, or providing bad checks,” according to the Minnesota U.S. Attorney's office.

Sarah Howe had a rule that allowed Ladies Deposit investors to withdraw only their interest earnings.

As Scott Rothstein's scheme began to unravel, he initially claimed he was experiencing temporary issues with the Florida Bar—and actually managed to raise an additional $100 million from acquaintances (see Red Flag No. 3).

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