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 Montana, as in other states, 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 frequently associated with fraudulent activities. The Montana Securities Act, administered by the Montana Commissioner of Securities and Insurance, requires the registration of securities offerings and licensing of individuals and firms offering investment opportunities. Promises of unusually high returns with little or no risk should be a red flag for potential investors. The term 'prime bank' is often used in these scams to lend an air of legitimacy, but these claims are typically baseless. The use of social media to promote HYIPs does not confer legitimacy and is often a tactic to reach a broader audience for fraudulent schemes. Montana residents are advised to verify the registration of any investment and the licensing of the person offering the investment with the Montana Commissioner of Securities and Insurance before investing. Additionally, federal laws enforced by the Securities and Exchange Commission (SEC) also apply, and the SEC has issued warnings about HYIPs and similar investment scams. Investors should exercise extreme caution and conduct thorough due diligence before committing funds to any investment program promising high returns with little or no risk.