The promoter takes the advance fee and never delivers the loan. In a ponzi scheme, there is no underlying business. Early investors are simply being paid with funds received from later investors. The scheme can continue only as long as new investors provide additional funds. These investments are similar in many respects to the advance-fee loan schemes described previously.
Investments range from a few thousand dollars to a hundred dollars or more.
Details about how the program works are either unavailable or, when examined closely, nonsensical. Recently, these schemes have been common in Mississippi. Investors' money is rarely recovered. These investments are frequently sold to people who live far away from the oil company's headquarters, which may be nothing more than a rented trailer. As with gold and silver mines, promoters frequently offer new and secret methods for reclaiming missed oil reserves on previously drilled fields.