We’re seeing more pyramid schemes on social media. Here’s how to protect yourself.

Read the article

In recent months we’ve seen more and more customers falling victim to a series of pyramid schemes being circulated on social media. Some of the schemes you’ve reported to us are called the ‘fractal mandala,’ ‘gifting circle,’ ‘circle of trust,’ ‘loom circle,’ and the ‘blessing loom.’

Pyramid schemes are often disguised as a quick way to make money, with zero risk. They usually rely on you paying to join, then persuading other people to sign up and pay too. They’re asked to do the same thing, and the chain keeps going. But schemes like this are unsustainable and often illegal, and you could end up losing hundreds of pounds. The only people that usually profit from a pyramid scheme are the ones who create them in the first place.

Pyramid schemes are an old-fashioned scam, and different versions have existed for decades. But, as the UK’s fraud reporting centre Action Fraud has noted, we’re seeing more and more new ones designed to target younger people.

How the schemes we’re seeing work

To join one of the schemes, you’ll usually be asked to pay (or “gift”) £160 upfront, with the promise that you can make £1,280 really easily.

Here’s what the scams look like on social media:

Screens showing pyramid schemes being shared on social media

They're often shared on Facebook or in people's Instagram stories.

When you join, you’ll be invited to a WhatsApp group by your friend, family member, or whoever’s post you replied to. They’ll then ask you to pay your £160 gift by bank transfer.

You’ll pay your “gift” to the person in the red circle in the middle of the diagram (Joe, in this case):

Example of the fractal mandala pyramid scheme

Then they’ll put your name in one of the pink spaces on the outside. To move up the pyramid (or in this case towards the centre of the circle), you need to persuade more people to join. When they do, they’ll each pay £160 to the person in the red space.

The idea is that once you sign up enough people you’ll reach the centre of the circle, and be the one who gets paid when new people join.

But the reality is that most people who join the scheme won’t make any money. As soon as new people stop joining, there’ll be no more money coming in. And when this happens, the scheme quickly collapses, leaving everyone (other than the person in the centre) out of pocket by at least £160.

How to spot a pyramid scheme

If you see posts circulating on social media it’s worth looking out for these warning signs:

  • Before you can join, they ask you to pay an upfront 'gift', 'fee' or 'investment' by bank transfer

  • They ask you to recruit more and more people to join as well, and encourage you to sign up your friends and family

  • They say you could make lots of money, really quickly

Remember the old saying: if something sounds too good to be true, it probably is!

Finding this post useful? Try Monzo today.

If you’ve paid into a pyramid scheme

If you’ve unwittingly paid into a pyramid scheme, try not to feel silly! This kind of fraud is very common, and fraudsters can be clever.

Once you realise you’ve been scammed, you should take steps to report the scheme and see if you can get your money back.

  • Tell your bank immediately. If you use Monzo you can do this by contacting us through in-app chat or by ringing 0800 8021 281. We can try contacting the bank where you sent your money to see if we can get it back.

  • Report it. You can report what happened to Action Fraud or call Police Scotland on 101 if you live in Scotland.

Joining a pyramid scheme is risky

  • You’ll probably lose all your money. Bank transfers move money out of your account instantly, meaning they’re almost impossible to cancel.

  • Your friends and family could lose out too. If you think you’ve found a good opportunity to make some extra money, and persuade your friends or family to sign up too, they’ll probably also lose their money when the scheme collapses.

  • Your bank account could be frozen. If you recruit people to join a pyramid scheme, you’re at risk of your bank freezing or even closing your account.

  • If you run or promote a pyramid scheme, you could go to prison. Starting, operating or promoting a pyramid scheme is illegal, which means you could end up in prison.

If you want to find out more, Action Fraud has published more information and advice. And if you think you’ve been involved in a pyramid scheme, please contact us immediately.


Pyramid schemes aren't the only way criminals can take your money. Learn how to protect your data to avoid identity theft and fraud.

At Monzo we work hard to protect you from fraud and help you keep your money safe.