Let's be honest, we would all love to find quick, easy, effortless ways to earn money. But if it sounds too good to be true, it probably is, especially when it comes to the Internet.

Just recently, one of the largest Ponzi schemes in the world unfolded in my state of North Carolina. A Ponzi scheme is a form of investment fraud that involves soliciting new investors by promising high returns with little to no risk. The scam in North Carolina had to do with Zeek Rewards (aka Zeekler.com). The business recruited more than one million investors from around the world and brought in over $600 million dollars. The Securities and Exchange Commission shut down the operation this month. The business was a fraud, and the owner was taking money from people promising a profit. People even believed they were making money online but were not able to "cash out." Now these people have lost hundreds and thousands of dollars by buying into this Ponzi scheme.

The worst part: millions of people fall for these Internet investment scams all of the time. The Internet is perfect for soliciting massive amounts of people instantly at little to no cost. So what can you do to avoid falling victim to an Internet scam?

Get the Facts

Assume all advertised deals and investments are scams until you've done your homework. Is the investment registered? To find out, go to the S.E.C's EDGAR database or to the North American Securities Administrators website.

Put the Company to the Test

Are they licensed and law-abiding? You can call your state securities regulator and ask whether they are licensed to do business in your state or have had any complaints or experiences with fraud. You can find out more information about this at the Financial Industry Regulatory Authority website. This link allows you to do free research on the business.

Want a quick assessment of the company? Go to the Better Business Bureau's website. First, put in your city and state. Then on the main page, click the link to "Check out a business or charity." Type in the name of the company, and a profile of the business will come up. The B.B.B. will give the company a letter grade on a scale of A+ to F, along with reasons for that rating. Reasons for low ratings can involve large amounts of complaints filed against the business, failure to respond to complaints, and if some kind of government action against the business has occurred.

Use Good Judgment

"If it sounds too good to be true, it probably is." The S.E.C. says to beware of opportunities that promise guarantees or risk-free returns. Be skeptical of "off-shore" or foreign investments. And look out for anything talking about "prime bank" securities–there is a history of fraud in that department. You can read about that here.

I hope this helps bring added caution to those who read about great investment opportunities online. Nothing worthwhile has ever come easy. I know a few people who lost thousands by making the mistake of investing in Zeek Rewards. For now, a class action lawsuit has been filed on their behalf, but it could take years to get their money back. So before you make the leap, do your homework.

This is a guest post by Amanda from Greensboro, NC
Find out more about the KCL Contributor Network!