Digital Financial Pyramids Through the Lens of Collective Expert Assessment

Abstract

The process of digital transformation of fraudulent schemes includes the financial pyramids. The existence of financial pyramids dates back hundreds of year. The phenomenon is steadily reproducing, however, digitalization has given unprecedented opportunities for the organizers to avoid responsibility and additional properties of the schemes themselves, causing an explosive increase in the number of pyramids in recent years. The objective of the study is to understand, whether there is a phenomenon of “digital financial pyramid”, and if so, to identify the it’s criteria. We use a two-step research procedure. The first step is crowdsourcing as a collection of information about a sample of pyramids from the list of the Bank of Russia by volunteers. The second step is a brainstorming among participants who are interested in financial pyramids. The results of the study are rated lists of * methods of attracting participants by the organizers (by channels and content), * characteristics of a person who is a potential participant in financial pyramids, * attractive features of high-yield risky schemes, * reasons why participants in high-yield risky schemes lose their investments. Academic and practical experts in the financial field have verified the results.