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Affinity Fraud

Affinity Fraud is a relatively new term pertaining to investment scams (often involving “Ponzi” or Pyramid methods) that target recognizable groups based on characteristics such as age, race, and religion most commonly. Ordinarily, Affinity Fraud occurs when dishonest people take advantage of people who are readily identifiable through a given group such as the elderly, members of a given church, people of a certain ethnic background, or members of a certain social or professional affiliation. Typically those that partake in Affinity Fraud claim that they are members (or desire to become members) of a given category or group of people as in attempt to gain the trust and confidence of such members. In the case of the elderly, such Affinity Fraud constitutes financial elder abuse in many states in this country. Affinity Fraud is not only a criminal act, it is also a civil wrong that is typically addressed in court. In the real estate industry alone, there have been countless Affinity Frauds where members of the targeted group of people have been encouraged to invest in loans where the security is worthless where those committing the fraud engage in a pyramid scheme.

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