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 Florida, High-Yield Investment Programs (HYIPs) are generally subject to both state and federal securities laws. These programs are often unregistered investments run by unlicensed individuals and are frequently associated with fraudulent activities. Florida Statutes, under the Florida Securities and Investor Protection Act (Chapter 517, Florida Statutes), regulate the offer and sale of securities within the state to protect investors from fraudulent schemes, including HYIPs. The Act requires securities to be registered and mandates that individuals and firms offering or selling securities, or providing investment advice, be licensed or registered. The hallmark promise of HYIPs of extraordinary returns at minimal risk is a classic sign of investment fraud. The Florida Office of Financial Regulation (OFR) would oversee the enforcement of these regulations. At the federal level, the Securities and Exchange Commission (SEC) also works to protect investors from such scams. The SEC has issued warnings about HYIPs and other similar scams, emphasizing that investors should be very cautious with these types of offers. Both state and federal laws prohibit fraudulent activities and deceptive practices in connection with the offer, sale, or purchase of securities. Floridians are advised to verify the registration of both the investment and the person or entity offering the investment with the OFR or SEC before investing.