High-Yield Investment Programs (HYIP) are unregistered investments typically run by unlicensed individuals—and they are often frauds. The hallmark of an HYIP scam is the promise of incredible returns at little or no risk to the investor.

An HYIP website might promise annual (or even monthly, weekly, or daily!) returns of 30 or 40 percent—or more. Some of these scams may use the term “prime bank” program. Fraudsters may use social media to promote an HYIP website or may encourage investors to use social media to share information about a HYIP website with others. If you are approached online to invest in one of these, you should exercise extreme caution—they are likely frauds.

In Connecticut, High-Yield Investment Programs (HYIPs) are subject to both state and federal securities laws. These programs are often unregistered investments run by unlicensed individuals and are commonly associated with fraudulent activities. Connecticut's securities laws, enforced by the Connecticut Department of Banking Securities and Business Investments Division, require that investment programs must be registered and that individuals offering investment advice or selling investments must be licensed. The promise of high returns with little or no risk is a red flag for investment fraud. The use of terms like 'prime bank' and aggressive promotion through social media are tactics often employed in HYIP scams. Connecticut residents are advised to verify the registration and licensing status of any investment program or advisor with the Connecticut Department of Banking and to be wary of any investment opportunity that sounds too good to be true. Additionally, federal laws enforced by the Securities and Exchange Commission (SEC) also provide regulations against fraudulent investment schemes, and the SEC actively pursues actions against such frauds. Investors are encouraged to report suspicious investment activities to the Connecticut Department of Banking or the SEC.