What does Ponzi scheme mean?

Ponzi scheme means the name of investment fraud in the financial field, and it is the originator of pyramid schemes.

This scam was invented by a speculator named Charles Ponzi. Charles Ponzi, an Italian-born speculator, lived in 19 and 20th centuries and immigrated to the United States in 1903. 19 19, he began to plot. These swindlers invested in a non-existent enterprise, promising investors a 40% profit return within three months. Then, the cunning Ponzi paid the new investor's money as quick money to the original investor to induce more people to fall for it.

Ponzi successfully attracted 30,000 investors within 7 months due to the rich returns of the early investors. This conspiracy lasted for a year, and only those who were carried away by interests woke up, and later people called it Ponzi scheme.

The so-called Ponzi scheme refers to the oldest and most common investment fraud, which is a variant of pyramid schemes. Many illegal pyramid schemes use this trick to collect money. It was originally invented by a speculator, but knowledge knows no borders and fraud knows no borders. Ponzi scheme is also used by many criminals in China. In layman's terms, it is robbing Peter to pay Paul, with empty gloves and white wolves. Pay interest and short-term returns to old investors with new investors' money to create the illusion of making money, and then defraud more investment. Including some online pyramid schemes, is also a Ponzi scheme.

It is worth noting that all scams involved in online financial management, compound interest investment and game financial management are Ponzi schemes and pyramid schemes. The basic operation rule is to use a small part of the funds deposited by the latter group of investors to pay the profits as investment returns to the former group of investors, so as to attract more funds, and so on, so as to double the debt base geometrically. It was not until the number of investors reached a critical point that it was difficult for new funds to pay interest, and the whole pyramid scheme collapsed. Of course, Ponzi schemes have also spawned more varieties with constantly changing names and techniques.