# Exit Scam
An *exit scam* or *rugpull* is a type of fraud in which the operators of crypto scheme abscond with investor money or crash an [ililquid](liquidity.md) market resulting in a net transfer of public funds to a [cartel](cartel.md) of insiders.

The anonomous nature of many [defi](defi.md) projects means these types of fraud are frequent and difficult to trace or prosecute by law enforcment.

See also [securities law](security.md) and [KYC requirements](kyc.md).

## References
1. Petro, Louis W., James P. Martin, Adam A. Wadecki, and Harry Cendrowski. The handbook of fraud deterrence. John Wiley & Sons, 2007.