Express News Service

CHENNAI: Multi-level marketing scams have donned an online avatar. Instead of pamphlets and posters, scammers use messages, audio and videos to trap people. For example, there are apps that promise high returns on investments. On registering, you get a referral code to share with your friends. And once they register, you get paid. Then they, in turn, invest and get referral codes to share.

These apps claim your investment goes towards a particular project, and the returns will be given to you. But that doesn’t always happen, explains Srikanth Lakshmanan, a researcher tracking digital payments and fraud. The scammers go to great lengths to make their companies appear legitimate. They pay the first level of people who join or sign up, and through them, attract others. But once more people join and invest, the returns stop, says Lakshmanan.

One such company used the name ‘World Bank’ to cheat people in the guise of angel funding. It created several groups on online messaging platforms, and uploaded pictures of people and pamphlets to convince victims. Once it was found to be a scam, the World Bank had to put out a warning to caution people, he points out.

Recently, a software engineer from Chennai invested in a similar app, received a referral code, and shared it with his friends, who then followed his footsteps. He received returns in his account on the app for each person who used his code. But when he sought to withdraw…

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