Christmas-themed pyramid schemes are on the rise and a small-loans trust is warning people to avoid them.
Natalie Vincent, of Ngā Tāngata Microfinance, said many pyramid schemes use cryptocurrencies, and are promoted primarily to Māori and Pasifika families.
Vincent said a new pyramid scheme is being sold to vulnerable people in the form of 'gifting' or 'koha' with the promise of making quick money.
It suggests people can get up to $20,000 after making three payments of $150.
Vincent said some people might make money at the very early stages, but further on, as is the nature of such schemes, it will collapse, leaving no money for anyone.
"The really scary thing is that a number of people that have come forward to us have actually borrowed money to put into these schemes."
She said any investment scheme that derives its income from recruiting new members, is considered by law to be a pyramid scheme, and is illegal.
Vincent said using cryptocurrency instead of cash allows would-be scammers to operate in the shadows, independent of banks.