There's a difference between a low probability of success that has a net negative financial value (startups, lotteries, America's Cup bids) and fraud.
In one case, there are just big risks that on average won't work out. In the other, there is no possibility for success because one party has no intention of following through on their promises.
If the scammer were actually in love, and just taking the money with the intention of investing it, but consistently blowing it in Vegas due to a gambling addiction, that wouldn't be fraud because he's still being honest.
It's the lying at issue, not the soundness of the investment.
And frankly I don't see many people saying "take options at a random startup to get rich, that's a good financial investment". Have you?
>There's a difference between a low probability of success that has a net negative financial value (startups, lotteries, America's Cup bids) and fraud.
That's not my point. if there's even a SINGLE person who is checking off all of the fraud checkmarks but is genuine, then it's more like a lottery.
For example, the famous Fedex story (you can google) where Fedex didn't have just a few more weeks of cash runway and would have had to shutter as it tried to raise it's investment round, and the founder gambled in Vegas to make their fuel run. Google that story.
100% scammer red flags - except it's real.
So, we have to differentiate. The mother in this equation is playing a lottery ticket that this particular person isn't a scammer. If there's even a single genuine story like that, anywhere, then that means it's a lottery ticket.
So it's not as simple as you say. For your question at the end, yes, I have seen that. :)
that's not a good differentiator because by the definition you have just given, any fraudster who themselves convinces themselves to believe their scam is no longer committing a scam. I reject that suggestion.
from the startup world, uBeam is a fraud, it's a scam: but it doesn't matter if their intent is valid or if they have convinced themselves to believe it. (I mention this as it's one of the only examples from the startup world.)
the legal situation may be different, but as a practical matter I don't think what you're saying is enough.
In one case, there are just big risks that on average won't work out. In the other, there is no possibility for success because one party has no intention of following through on their promises.
If the scammer were actually in love, and just taking the money with the intention of investing it, but consistently blowing it in Vegas due to a gambling addiction, that wouldn't be fraud because he's still being honest.
It's the lying at issue, not the soundness of the investment.
And frankly I don't see many people saying "take options at a random startup to get rich, that's a good financial investment". Have you?