BROKERS BEWARE! There is absolutely no way for a broker in the United States to lawfully present to an investor a high yield investment program as described above.
This applies to private placements as well as the many unintended public offerings; i.e. the broker breaches the law by unknowingly violating the prohibitions against public offerings without complying with the Federal and/or state securities statutes. And it is vital for brokers to understand that if they do anything (called an Covert act) with regard to passing on to other brokers or investors representations (written or oral) of (a) no risk deals, (b) implied but untrue ownership of MTNs, or (c) earning extraordinary profits as described above, they become a co-conspirator and are criminally liable for felony prosecution (including money laundering).
So, if you are a broker in this business with products as described above, you are involved in a criminal enterprise.
Unlawful Agreements. It is also important to note that because the agreements to provide HYIPs are to provide an unlawful (non-existent) product, the contracts are illegal and unenforceable, including the agreements for compensation to the brokers.
So the broker cannot even sue for the commissions that he didn't earn on the non-existent investment.
This is not a smart business in which to engage, civilly or criminally.
Some Advice For Brokers. I am often struck by the sad situation where naive brokers without any criminal intent whatsoever find themselves suddenly in very serious legal trouble believing in their innocence, because they followed all the precautions they learned from other brokers.
So here is some additional advice. Other than to stay away from the HYIP business, there are two good pieces of advice to consider.
First, do not keep any copies of instruments anywhere within your apparent control (including your computer), because if you possess a fraudulent document this may be (a) itself a crime and (b) very condemning evidence against you for other related crimes.
Second, if you are approached by law enforcement regarding your activities, do not try and explain your way out of the problem. You can't do it!
It is impossible. Say nothing! They do not care to hear about your innocence. They are only there to make a case against you.
Whatever you say, will be taken adversely to your interests no matter how innocent you think you may be. That is their job. Tell them you will speak to them only after you have consulted a lawyer; this is your Constitutional right, use it!
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