The recent uptick in fraud audits, denials and revocations may seem unusual, but it is not particularly new. One former Centers for Medicare & Medicaid Services employee said he has seen it before — in the late 1990s.
“I worked for CMS on the heels of Operation Restore Trust, where I saw the current intermediary pattern of deceit and basically dysfunction evolve,” explained Michael McGowan, a former CMS Region IX OASIS…
Investment fraud targets the human desire for financial growth by promising high returns with “low to no risk.”
- Ponzi Schemes: Named after Charles Ponzi, these schemes pay “returns” to earlier investors using the capital brought in by newer investors. There is no actual underlying business; the system collapses when new recruitment slows down.
- Pyramid Schemes: Similar to Ponzi schemes, but participants are usually required to sell a product or service. The primary “profit” comes from the recruitment fees of new members rather than actual product sales.
- Pump and Dump: Fraudsters spread false, positive rumors about a cheap stock (the “pump”) to drive up the price. Once the price peaks, they sell their shares (the “dump”), leaving other investors with worthless stock.