State Officials Warn People Of Old Scam After “Blessing Loom” Resurfaces During Pandemic

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State Officials Warn People Of Old Scam After “Blessing Loom” Resurfaces During Pandemic

If you hopped on social media within the last 24 hours then you probably came across this image shared by a ton of your friends or followers. While many folks believe it’s a way of “investing,” apparently it’s not, and now officials around the country are warning folks about the scam.

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According to CBS News affiliate KUTV, this is actually an old scheme known as the ‘Blessing Loom’ which involves a group (the ‘loom’) where each person pays an entry fee to join. As more people join the loom, the original members get payouts from the money of the new members.

University of Utah law professor and former federal Consumer Financial Protection Bureau official Chris Petersen told the news site that the ‘blessing looms’ are nothing more than Ponzi schemes. The Federal Trade Commission has even warned against these types of scams in the past– where new money is used to pay off older customers – for decades.

Petersen says:

“Some of these schemes are very old, and they’re also very illegal.”

Now, some people on social media claim that they weren’t actually scammed and have encouraged their friends to take part in the “game.” Meanwhile, others are telling folks not to use their stimulus checks to do such a thing, especially during this time where most people don’t have extra money to spend due to this pandemic.

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