It’s early summer of 1920, and the streets leading to the offices🏢 of Charles Ponzi are filled with people queuing to invest in his business. Within a few months, Ponzi was attracting hundreds of thousands of new investors daily💵. How? He had 18 people invest a total of $1800 in January 1920. He promptly paid them their 50% or 100% profit💷 on the 45th or 90th day as promised…
This won him their trust and more customers came. A few months later, Ponzi was making almost a million dollars daily in sales! Bankers, Policemen💂♂️, businesses, politicians, civil servants🕵️♀️ etc., all queued to invest with Ponzi. Indeed, it is said that 75% of Boston’s police force were his customers👨✈️. People were withdrawing their money from banks to invest there. Others mortgaged their homes🏘 and invested their life savings…
With his new-found money, he invested into banks and tried to buy off others🏣. He had so much money at the banks such that he became a major shareholder🏦 and controller of these banks. When a prominent reporter wrote that his business was a scam, people rushed for their money💸 and he quickly mobilized money from the banks and paid them off🏦! These people regretted their actions and went back to deposit their money with him again☺️!
Whenever their stocks matured, the customers will roll it over to get more money📈… and oh boy he began to live a luxurious life! He went on expensive vacations🛳, bought an expensive mansion, the finest car of the time🚘, used expensive first-class tickets for his mum etc…
Yet, he had no records of all these transactions by investors😕… when auditors came to audit his books, he will find a way to swindle them😳. However, his lifestyle and scheme began to draw the attention of the Federal government⚖️. News of this scrutiny of his activities sent people rushing for their money🪙 and he quickly mobilized the banks to pay them off🧰… seeing this, the government stopped the banks🏦 from further payments until he was fully audited.
The audit found him to be in debt with no records of his transactions or business📝 to bring in the profits he promised people. He was robbing Peter to pay Paul🙅. He was thus arrested and that quickly collapsed six banks. About $20 million of investors’ money🧰💸 were gone like the wind and people’s fortunes and life savings went under. Even when in prison⛓, his gullible investors sent him postcards and their investments🧳!
He came out and went down to Florida to cause more scams🤹♂️ by selling land fraudulently. He was arrested again and later deported🛳 to Italy after serving years in jail. In Italy, he tried unsuccessfully to undertake similar schemes🤦♂️. He went to live in Brazil and worked for an airline🛩, which collapsed during World War II. He did, however, write his autobiography📙 albeit he ended up a pauper🧙♂️. In his own words: “I set out looking for trouble, and I found one”.
Owing to the widespread nature of his business, all such money💰 frauds became known as the Ponzi’s scheme. He loved money but ended up being its slave⛓… He destroyed the livelihood, future, jobs, investments💶🪙, and savings of millions who were led by greed, and only paid for it with a relatively shorter prison time of 12-20 years! Greed and love of money are relatives👨👩👧👧, they will lead you astray! If you think Ponzi was bad, wait for next week🧭. Have a happy peaceful Sabbath🌹!
