This study examined the effect of Ponzi scheme on poverty alleviation in Rivers State. The purpose was to study the relationship between Ponzi scheme and poverty alleviation. Questionnaire was administered to 400 respondents sampled from residence of port Rivers State. Four research questions and null hypotheses were formulated to study the effect of Ponzi scheme on poverty alleviation in Rivers State. Ponzi scheme was proxy by Mavordi Mondial Money, Get Help Worldwide Exclusive, Twinkas and Wealth funds while poverty was proxy alleviation of relative poverty, absolute poverty, subjective   poverty and dollar   poverty. Simple percentages and spearman rank correlation coefficient was used as data analysis methods. The study found a correlation coefficient of 59.3 and probability value of .036 between Mavordi Mondial Money and the Alleviation of Relative Poverty. 60.3 and probability value of .006 between get help worldwide exclusive and   the alleviation of absolute poverty. 52.6 and probability value of .011 between Twinkas and   the Alleviation of Subjective Poverty and 39.4 and probability value of .078 between Wealth funds and the alleviation of dollar poverty in Rivers State. From the findings, the study concludes that Ponzi scheme increases poverty in Rivers State. The study recommends that Policies such as financial awareness ease access to business finance and investment promotions should be directed towards increasing financial access of low income earners to reduce investment in Ponzi scheme. The operational efficiency of the financial institution should further be strengthened; existing challenges should be eliminated by the regulatory authorities and there should be increase in rate of return on savings rate to discourage investment in Ponzi scheme.