Which of the following statements highlights the fraudulent nature of a pyramid scheme?
The scheme phases out new recruits from the pyramid by withholding vital information they need to sell their financial products.
Any investment return from the scheme depends solely on an individual's capacity to recruit new individuals to the scheme.
Membership fees are invested in shares of stock from different companies but only part of the interest earned is returned to investors.
The scheme ensures low risk but high returns to its investors by investing their money in profitable shares.
