Is a sou sou legal?
Traditionally the arrangement is conducted in cash and without any interest charged. The organizer of the sou-sou may be compensated for their efforts as a courtesy. Since a sou-sou is not a written or legal contract it relies on personal trust to discourage malfeasance.
Is a sou sou legal in the US?
There are no laws against sou-sous as long as every member gets exactly what they put into it. However, there is little legal recourse in the event someone is taken advantage of.
Are Sou Sou legit?
Although there are legitimate sou-sous, there are also scams parading as sou-sous that are illegal pyramid schemes. This leaves later contributors–those near the pyramid’s bottom who are the last ones to join–without a payout and the loss of their original investment.
Is money pooling illegal?
Real-money pools, even just between friends, with no one taking a cut, are “generally illegal in 37 of 50 states,” according to a 2018 legal analysis commissioned by the American Gaming Association.
Is the Susu Flower illegal?
Prosecutor Tyner warns that despite guarantees by scheme promoters, these Pyramid Schemes called Sou-Sous, Flowers, or Gifting Circles are illegal. Individuals, participating in the scheme could face charges of wire fraud, tax fraud, and theft by deception.
Are gifting circles illegal in US?
Gifting clubs are illegal pyramid schemes where new club members typically give cash “gifts” to the highest ranking members. If you get more people to join, they promise you will rise to the highest level and receive a gift much larger than your original investment.
How does a sou sou savings club work?
A sou-sou (also spelled sou sou, su-su or susu) is an informal rotating savings club, where a group of people get together and contribute an equal amount of money into a fund weekly, bi-weekly or monthly. The total pool, also known as a hand, is then paid to one member of the club on a previously agreed-on schedule.
Do you pay interest on a sou-sou loan?
Traditionally the arrangement is conducted in cash and without any interest charged. The organizer of the sou-sou may be compensated for their efforts as a courtesy. Since a sou-sou is not a written or legal contract it relies on personal trust to discourage malfeasance.
Where did the money come from for Susus?
The funds are generally gathered with a set amount contributed from family or friends each week. An estimated three quarters of Caribbean immigrants in New York participated in susus during the 1980s. Scammers have set up pyramid schemes which imitate or pretend to be susus.
How does a Susu loan club work in Africa?
The name is used in Africa (especially West Africa) and the Caribbean. The basic principle is that each member of the group makes a standard contribution to a common fund once per some time period. Then each period the total contributions are disbursed to a single member of the group.