Investment fraud: Ponzi scheme


Do you know the word Ponzi scheme? It is one of the most difficult investment scams to detect. This scam was created by the famous American scammer Charles Ponzi and is still the mainstream scam for over 100 years. It is used for general investment such as deposits, insurance, automatic FX trading, stocks, investment trusts, so be careful if you are investing. If a suspicious consultant intervenes in your investment product, it may be a scam.


What is Ponzi scheme?

The Ponzi scheme is named after Charles Ponzi, an American scammer. We collect money in the name of soliciting investment and paying investment profits as dividends, but there is no actual investment, and while paying investment from new investors as dividends, we deceive money on the assumption that it will go bankrupt. It’s a technique. Established over 100 years ago, this fraudulent method is used throughout investment and is characterized by being hard to notice. People are constantly being fooled by the high dividend yields. Most of them claim an unusual yield of 30% per month or 10% or more per year.

Charles Ponzi

Charles Ponzi is the person who devised the Ponzi scheme. Charles Ponzi is said to have been born in Italy in 1882. He moved Ponzi to America at the age of 21. He worked as an interpreter, waiter, and dishwasher in Ponzi, Boston and New York. He lived in a Canadian prison in 1908 for forging documents and was sentenced to two years in prison in 1910 for smuggling five Italians from Canada to the United States.

And around 1919, Ponzi was working hard at a bank at the time, but he realized that his bank was paying twice as much interest as other banks, and that he had more and more customers. As a result, bank owners fled somewhere with all the rest of the money, as the profits of a bank loan alone could not pay the promised interest to the customer. Seeing this, Ponzi devised a Ponzi scheme. Ponzi was subsequently deprived of American citizenship and returned to Italy, then moved to Brazil, where he worked as an office manager but was unemployed and died of poverty in 1949.

Fraud tricks

Ponzi scheme is a fraudulent technique used in all investment products. Of these, investment trusts, deposits, insurance, etc. often use this method. Consider the possibility of fraud if you have the following solicitations:

Yield too high

In the case of fraud, we often offer high yields such as 30% or more per year and 3% or more per month. It is characterized by high-yield presentations that are unrealistic, and it also creates forged data on investment performance to deceive investors.

There is an intermediary

A characteristic of investment fraud is that there are often suspicious intermediaries. Be aware that the intermediary often escapes after introducing an investment product.

Foreign investment products

There is a tendency to introduce foreign investment products as one of the characteristics of investment fraud. Many foreigners do not know foreign laws and companies, so it is very convenient to deceive investors.