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 Missouri, affinity fraud is considered a type of financial fraud or investment scam that preys upon members of identifiable groups, such as religious or ethnic communities, or the elderly. These scams are illegal under both Missouri state law and federal law. Missouri's securities laws, found in Chapter 409 of the Revised Statutes of Missouri, prohibit fraudulent securities practices, including misrepresentations, omissions of material facts, and engaging in any act, practice, or course of business that operates as a fraud or deceit upon any person in connection with the offer, sale, or purchase of securities. Additionally, the Missouri Securities Act of 2003 provides the regulatory framework for securities transactions in the state and empowers the Missouri Securities Division to investigate and enforce actions against fraudulent investment schemes. At the federal level, the Securities and Exchange Commission (SEC) also targets affinity frauds, as they often involve securities fraud, which is a violation of the Securities Act of 1933 and the Securities Exchange Act of 1934. Victims of affinity fraud in Missouri are encouraged to report the fraud to the Missouri Securities Division and may also have the option to pursue private legal remedies, such as filing a civil lawsuit to recover losses.