Affinity frauds target members of identifiable groups, such as the elderly, or religious or ethnic communities. The fraudsters involved in affinity scams often are—or pretend to be—members of the group.

Fraudsters may enlist respected leaders from the group to spread the word about the scheme, convincing them it is legitimate and worthwhile. Many times, those leaders become unwitting victims of the fraud they helped to promote.

These scams exploit the trust and friendship that exists in groups of people. Because of the tight-knit structure of many groups, outsiders may not know about the affinity scam. Victims may try to work things out within the group rather than notify authorities or pursue legal remedies.

Affinity scams often involve Ponzi or pyramid schemes where new investor money is used to pay earlier investors, making it appear as if the investment is successful and legitimate.

In Minnesota, affinity fraud is considered a serious criminal offense. The state's statutes on fraud and deceptive practices, such as the Minnesota Prevention of Consumer Fraud Act (Minnesota Statutes, Chapter 325F) and the Minnesota Uniform Securities Act (Minnesota Statutes, Chapter 80A), provide the legal framework to address such scams. These laws prohibit deceptive practices in commerce and the sale of securities, respectively. Affinity fraud, which often involves Ponzi or pyramid schemes, can also be prosecuted under federal law, particularly by the Securities and Exchange Commission (SEC) and the Department of Justice (DOJ). The Minnesota Department of Commerce is the state agency responsible for regulating securities and enforcing laws against fraudulent investment activities. Victims of affinity fraud in Minnesota are encouraged to report the crime to the appropriate state or federal authorities, including the Minnesota Attorney General's Office, the Minnesota Department of Commerce, or the SEC. Despite the close relationships within groups that may be exploited by affinity frauds, it is important for individuals to seek legal recourse and report these crimes to prevent further victimization and to hold the perpetrators accountable.