Quebec’s financial markets regulator (AMF) is warning the public to be cautious of multi-level marketing investment schemes with the promise of financial freedom. The AMF said in a news release that “in some cases, they may be part of a pyramid scam.” Organizations and individuals, the AMF said, are trying to attract Quebecers to invest and earn money by recruiting others to the scheme. “To this end, investors are being encouraged to solicit people in their circle (e.g., friends, family members, colleagues, members of their ethnic or religious community),” the AMF said. “The promoters of such organizations hold in-person or on-line promotional events (e.g., Zoom presentations) during which they employ various persuasion techniques, including the promise of financial freedom or personal growth and (often fake) success stories.” The regulator says that most of the promoters and organizers are not registered to act as financial advisers or dealers and that investors could suffer “significant financial losses.” “The AMF reminds the public that offering investments—whether over the Internet, by telephone or in person—is a regulated activity,” the regulator said. “Any individual or firm promoting an investment product must be registered with the AMF or benefit from a registration exemption.” Those being solicited can check if the organization or person is registered through the AMF’s information centre or in the register of firms and individuals authorized to practice. The AMF lists a series of steps to avoid financial fraud:
