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https://www.axios.com/local/salt-lake-city/2023/02/06/alleged-affinity-fraud-mormons-vegas-utah Quote:So the scheme allegedly was the principals were selling these personal injury settlements, basically saying, you know, we are going to loan some money to someone who has slipped and fallen. And in 90 days, they’ll pay us back. And if you keep your money invested with us, that will mean you’ll get an annualized return of 50%. And so that was really enticing to a lot of people. It’s a really good return.
And it started working its way through the Mormon church. A few of the principals and the marketers were Mormon, and so they allegedly told their friends and family about it, and it spread from there. You had people who were investing their retirement accounts, who were getting a second mortgage on their house, who were putting all of their savings into this because it seemed like such a good deal. This is really common in what they call an affinity fraud. Basically, your sense of trust is so high because these are people that you see every Sunday at church. They belong to your ward. You see them at the grocery store. Your children grow up together.
And, you know, you just don’t expect that someone that you trust is going to defraud you. There was one victim that I talked with who described it as, you know, the red flags were heart shaped. So even though the warning signs were there, she trusted the person who had told her about it and didn’t expect this outcome.
Affinity fraud is not unique to the LDS church. In some ways it plays upon our strengths (penchant for faith, trust, and close community) and makes them into vulnerabilities (we can be too faithful and trusting when the source is from within the community).
Quote:Basically, your sense of trust is so high because these are people that you see every Sunday at church. They belong to your ward. You see them at the grocery store. Your children grow up together.
The people telling you about the investment opportunity are usually people that 100% believe in it themselves. There’s only a few people at the top that know it’s a fraud but the people doing the word of mouth marketing are usually believers. The guy you see at church isn’t trying to scam you, the guy at church truly believes they’re helping you out.
Also, just to be crystal clear, I’m not trying to draw a parallel between people at the top of a pyramid scheme and church leaders. I’m just saying that it’s not always as simple as, “That person scammed me!”
nibbler wrote:
The people telling you about the investment opportunity are usually people that 100% believe in it themselves.
Right. One program that I saw on a Ponzi scam in Australia detailed how the victims had a double sense of mourning. 1st they mourned for their own financial losses and their own hopes and dreams for a more secure future. They are also mourning that everyone else that they invited into the opportunity was similarly scammed. These are family members and close friends that might have invested their retirement, their kids college funds, or taken out a second mortgage. Yes, each and every one of them made their own decision, but they were sold on the idea by someone that they trusted and that person (unwitting though they were) must feel terrible about the part that they played.
nibbler wrote:
Also, just to be crystal clear, I’m not trying to draw a parallel between people at the top of a pyramid scheme and church leaders. I’m just saying that it’s not always as simple as, “That person scammed me!”
I certainly don’t believe the top leadership of the church are involved in any Ponzi/pyramid scheme. I do believe some local leaders may be and others who are not leaders are – some knowingly and maliciously. The fact is that Mormons tend to be very vulnerable and gullible, especially when something is coming from another Mormon. There many exceptions of course, but there is a reason so many pyramid schemes thrive in Utah.
I admit I was trying to draw a small parallel to experiences people have when going through a faith crisis. Often people feel like they’ve been lied to but the people that taught them were true believers in what they were teaching. Roy extended the analogy and it also fits, many people that have experienced a faith crisis often worry about what they’ve taught to others (kids, converts on their missions, etc.).
But it’s much more complicated than someone simply lying.
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