Looking for big money in the grey zone. Simulation of High Yield Investment Programs strategies

Katarzyna Gniadzik, Grzegorz Kowalik, Oskar Jarczyk, Radoslaw Nielek

Abstract


High Yield Investment Programs (HYIPs) are online versions of a Ponzi scheme, a fraud that offers extremely high interest rates to attract investors – and pays them up to the moment when HYIP owner decides to run away with the money accumulated in the account. This article presents a simulation focused on the connections between investments in appealing websites, advertising, and runaway strategies to explore and describe one of the grey zone areas. The model is based to a large extent on real-life data acquired from HYIP monitors. In this paper, we have proven that advertising and layout have a great impact on an HYIP’s balance. Moreover, most HYIPs are capable of gaining similar balance; however, there are also conservative strategies that significantly reduce profits.

Keywords


HYIP; Ponzi scheme; fraud; simulation; strategy

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References


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DOI: https://doi.org/10.7494/csci.2015.16.3.237

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