Separate topics with commas, or by pressing return. Use the delete or backspace key to edit or remove existing topics.
You can leave an optional "tip" with Mahalo's virtual currency, Mahalo Dollars. If you are asking a difficult question that might require some research, or if you'd like a wide variety of feedback, a higher tip often leads to more answers to your question.
M$1 Answer
Here is what I found listed on the Money terms website regarding what a Ponzi Scheme is and how it works:
"A Ponzi scheme is an investment scam that appears to be actually paying high returns by paying the supposed returns out of victims' own capital. Ponzi schemes are named after Carlo Ponzi who ran a huge Ponzi scheme in the US in the 1920s.
A typical Ponzi scheme promises investors a high rate of return in a short time. The money that is collected from investors is used to pay the return. This means the scam can run for some time, because investors appear to be making the promised return. Early participants can profit, as they can with a pyramid scheme.”
So basically a Ponzi scheme is a money investment deal that doesn’t actually exist and can in the long run cause investors to lose their money. The scam got its name from Carlo Ponzi who of course ran such schemes back in the 1920’s. But perhaps one of the most notorious examples of a Ponzi Scheme in recent history is the one that was perpetuated by Investor Bernie Madoff. Madoff as you may know cost thousands of people billions of dollars in a Ponzi Scheme that came to light at the end of 2008. Madoff had thousands believing that he was investing their money in legitimate companies when all along he was defrauding them. Such a thing is illegal because the investor is lying to someone in order to get them to invest in something that doesn't exist, in other words committing fraud.
http://moneyterms.co.uk/ponzi-scheme/
http://en.wikipedia.org/wiki/Bernard_Madoff
"A Ponzi scheme is an investment scam that appears to be actually paying high returns by paying the supposed returns out of victims' own capital. Ponzi schemes are named after Carlo Ponzi who ran a huge Ponzi scheme in the US in the 1920s.
A typical Ponzi scheme promises investors a high rate of return in a short time. The money that is collected from investors is used to pay the return. This means the scam can run for some time, because investors appear to be making the promised return. Early participants can profit, as they can with a pyramid scheme.”
So basically a Ponzi scheme is a money investment deal that doesn’t actually exist and can in the long run cause investors to lose their money. The scam got its name from Carlo Ponzi who of course ran such schemes back in the 1920’s. But perhaps one of the most notorious examples of a Ponzi Scheme in recent history is the one that was perpetuated by Investor Bernie Madoff. Madoff as you may know cost thousands of people billions of dollars in a Ponzi Scheme that came to light at the end of 2008. Madoff had thousands believing that he was investing their money in legitimate companies when all along he was defrauding them. Such a thing is illegal because the investor is lying to someone in order to get them to invest in something that doesn't exist, in other words committing fraud.
http://moneyterms.co.uk/ponzi-scheme/
http://en.wikipedia.org/wiki/Bernard_Madoff
You can leave an optional "tip" with Mahalo's virtual currency, Mahalo Dollars. If you are asking a difficult question that might require some research, or if you'd like a wide variety of feedback, a higher tip often leads to more answers to your question.
M$Report Abuse
