Blessing Loom Pyramid Scheme Brings False Promise of Wealth, just in time for Christmas

HOUSTON, TX -- A new scam sweeping the U.S. is hitting the Houston area just in time for Christmas, and it is bringing home the old adage: “If it sounds too good to be true, it probably is.”

This latest pyramid scheme is called the “blessing loom” and it is designed to play on the trusting nature of people to donate money and expect a greater return quickly.

One Houston area woman said she was taken in by the scheme when she was made a promise by a trusted friend.

The woman, identified only as Jasmine, said after hearing the details, she was all in and joined this blessing loom.

“I was told by her that if I put in $500 -- and getting two people to join, which they will pay $500 as well -- I would be able to get $4,000 back," Jasmine told KPRC.

However, once she’d paid the $500, Jasmine had difficulty recruiting anyone to opt in and is still trying to recruit the one more to hopefully get that promised return because until she does, her money won’t be coming back.

“They kept on putting pressure on me that I needed to find my other -- my second one,” Jasmine said.

The blessing loom, which is permeating social media sites like Facebook and Twitter, is merely a twist on an old scam, resurrected and known by other names such as Infinity Loom,
Snowflake Blessing, Giving Circle and Christmas Blessing.

And while the schemes are known by any number of names, they all work the same.

The schemes can cost as little as $10 to join, after the target has received an invitation, usually from a trusted friend or family member.

One person, the one in the center, recruits two people to join, who recruit two more, and so on, and so on until the spots are filled.

The scammers use Whatsapp and PayPal to collect the funds once the victim has been lured to join the growing blessing loom.

Once the spots are all filled, the person in the center gets all the money they were promised when they joined. Then it begins again.

So what are the warning signs you are being phished?

The U.S. Securities and Exchange Commission has a couple of warning signs you should be aware of:

• The emphasis is on recruiting new members in turn for a fee as opposed to selling a product.
• No genuine product or service is sold in return for the money.
• There's a promise of high returns in a short time.
• There are promises of easy money or high returns for very little investment.

Last year, the Secret Sister Exchange, which involved participants trading presents in an ever-widening circle in return for a wave of gifts coming back to them, made the social media rounds. Secret Sister has popped up again this year but just like the Blessing Loom, experts advise people to stay away.

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