Ponzi scheme

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Related to Ponzi schemes: insider trading, Pyramid schemes, Bernie Madoff

Pon·zi scheme

A fraud disguised as an investment opportunity, in which initial investors and the perpetrators of the fraud are paid out of funds raised from later investors, and the later investors lose all funds invested.

[After Charles Ponzi (1882?-1949), Italian-born speculator who organized such a scheme (1919-1920).]

Ponzi scheme

a fraudulent investment operation that pays quick returns to initial contributors using money from subsequent contributors rather than profit
[After Charles Ponzi, who famously perpetrated such a scheme in the United States of America in the early 20th century]
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References in periodicals archive ?
In an effort to combat a decade of Ponzi schemes and ill-capitalized banks, the Central Bank Monday finally ceased issuing licenses for new private banks and commercial lenders.
Ponzi schemes represent a financial investment scam in which the fraudster uses money from new investors to pay earlier investors.
This book explains how Ponzi schemes operate: how they differ from pyramid schemes, Ponzi finance, and other financial arrangements; the schemes of Charles Ponzi, Bernie Madoff, and Allen Stanford.
Ponzi schemes usually collapse on themselves when new investments stop.
The bench referred to its May 9 last year's order directing the agency to probe the duping of thousands of people of over Rs 10,000 crore through several ponzi schemes in West Bengal, Odisha and Assam.
Summary: In a bid to curb the menace of Ponzi schemes and protect investors, the Securities and Exchange Board of India (Sebi), which regulates the Indian capital market, has been granted more powers.
Established by Sergei Mavrodi, MMM was a Russian company that perpetrated one of the world's largest Ponzi schemes of all
The State Bank of India (NSE: SBI) has said that the Indian central bank or SEBI needs to create awareness against Ponzi schemes.
THE CENTRE has asked the chief ministers ( CMs) to initiate vigorous police action against fraudsters cheating investors through Ponzi schemes such as chit funds and also sought increased surveillance by the Reserve Bank of India ( RBI) to check the menace.
In recent years, Ponzi schemes have captured national headlines and left a broad array of victims--often individual investors -- devastated by the scheme's aftermath.
Unfortunately these sorts of recoveries are kind of the nature of the beast when it comes to Ponzi schemes," he said.
In December 2008, Madoff was arrested for securities fraud after he masterminded one of the largest and longest-running Ponzi schemes in U.