Social media users are being tempted by Ponzi schemes promising to make them large amounts of quick money, we can reveal.

We have been alerted to get-rich-quick pyramid schemes, promoted by users on Facebook and its messenger service, which claim that those who sign up and put money in can then reap the rewards of signing others up below them.

One says: 'Looking for 10 people who want to turn £50 into £6050, PM [private message] only)

Action Fraud UK confirmed that one of the adverts fits the description of a Ponzi scheme - the scams named after Italian Charles Ponzi, who raked in large sums in 1920s America.

Social media users are trying to recruit others into Ponzi schemes, as these screenshots show

The schemes have been dubbed 'money flipping' and involve paying to gain a place on the bottom row of a pyramid.

Eventually, the participant moves to a slot where a new row of people signing up then pays them money directly - delivering their profit.

A This is Money reader who alerted us to the get-rich-quick schemes, said they had seen one scheme where people paid £50 to join and another where people paid £129.

Pyramid selling schemes are illegal and people who establish, operate or promote them can be prosecuted under the Consumer Protection from Unfair Trading Regulations 2008.

The bold claims could tempt people into schemes, with participants telling others how they have made money.

Eventually, however, like the original Ponzi scheme nearly 100 years ago, it is likely to fold leaving many people out of pocket.

Our reader replied to a promotion to find out more as part of our investigation. Upon sending a private message, he was given a convoluted explanation as to how the scheme works.

He was told that it works by signing-up more individuals below your level to pay-in, so you rise up the pyramid and take a cut.

You pay to join with your payment going to someone on the next rung up on the pyramid. You then help recruit others to build the next layer of the pyramid. The people you then recruit have to do the same and so-on-and-so-forth.

The reply said: 'When you pay your join fee you start on the bottom row, that fills up the four bottom spaces and you move up.

'It's a team effort so everyone recruits people because it means that everyone moves up to the cash out spot, you don't have to worry about recruiting until your payment proof is there.

'I'm cashing out every 24 hours, being doing it two days, two more people and I'll have made £1000.'

Pyramid scheme: We have been alerted by a reader over concerns social media users may be tempted into getting involved with schemes such as the above

We have also been sent another screen shot of something called '$175:$700' – again the idea being that you recruit more people below you in the pyramid to make money.

The reader who alerted us to the schemes said: 'A trend I have noticed that worries me is flipping money on social media.

'A user offers a chance for others to turn say £50 into £200. All it takes is to convince other Facebook users to pay you £50 and tell them then to recruit further.

'It is the most basic pyramid scheme, and in these schemes 70 per cent of the "investors" will lose their money while some will take a profit.

'It wasn't something I had heard of until recently, but apparently it's popular around America and spreading this way too.'

Rather than being advertised directly on Facebook, the schemes appear to be being promoted through posts on people's feeds and its messenger service - passed on by the digital equivalent of word of mouth.

Nonetheless, this type of promotion violates the terms of service for sites like Facebook and should be reported to the firm.

We contacted Facebook, which said that fraudulent activity would break its community standards if reported. The best way to report such activity on Facebook is by using the drop down link on the top right of the post.

This is Money contacted Action Fraud UK, the body in which customers are encouraged to contact if they fall victim to a scam.

It confirmed that the above fit the description of a Ponzi scheme and says that there was a 45 per cent rise in reporting of such scams in the 2017/18 financial year compared to the one before.

GET IN TOUCH Have you seen a Ponzi scheme advertised on social media - or perhaps have got involved in something similar? Get in touch: lee.boyce@thisismoney.co.uk

The social media adverts come after This is Money has been sounding the alarm about the worrying growth in 'money mules' often recruited online in the same way.

We recently revealed that Lloyds Bank has set up a crack team to deal with the problem which sees individuals allow their bank account to be used to facilitate the movement of illegal funds.

Ponzi schemes have been around in all shapes and sizes for decades.

Earlier in the month, a Mississippi man stole more than $100million from hundreds of victims in a Ponzi scheme that stretched across multiple states, according to authorities.

Ponzi schemes are named after Charles Ponzi. Operators of the scheme promise high returns on investments – but instead of investing funds, they use their cash to pay off earlier backers and take a cut.

As the scheme grows, the number of victims and the size of combined losses grow significantly.

Ponzi set up an investment scheme to exploit differences in the price of postage stamps in Italy and the US. However, he ended up using new investors' cash to pay existing investors. At the height of his success in 1920, Ponzi was making $250,000 a day - a mammoth sum for the era.

When his scheme collapsed, Ponzi pleaded guilty to fraud and was sentenced to five years in a federal prison.