Born in 1882 in Italy, he became notorious for his money-making fraudulent schemes in North America in the 1920s.
Charles Ponzi and the Postal Service
The story of the man who put the 'Ponzi' in 'Ponzi scheme'
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Born in 1882 in Italy, he became notorious for his money-making fraudulent schemes in North America in the 1920s.
After many professional failures, he moved to Montreal in 1907 and started working as a bank teller at Banco Zarossi, where he rose to the position of bank manager.
However, he got involved in smuggling illegal immigrants into the country landing in prison for another 2 years, moving back to Boston after that.
Post-WW1 inflation decreased the postage cost in Italy in terms of US dollars, with Ponzi claiming that redeeming them for a higher price in the US would net him a profit of 400%.
He then proceeded to set up a stock company to attract capital from investors.
As the word spread around town many investors rushed in at an increasing rate.
Ponzi used some of the invested capital to buy a controlling interest at a local bank in Boston.
However, for Ponzi to create his promised returns he would need to buy and resell millions of IRCs, with only a few tens of thousands in circulation.
Despite many newspaper articles questioning his quickly acquired wealth and a criminal investigation, he managed to continue operating his scheme.
It was finally revealed that Ponzi had amassed a debt of $7 million, having taken many loans from the bank he controlled.
The losses for his investors came up to $20 million, approximately $250 million in today's terms.
/END
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Charles Ponzi and the Postal Service
— Kostas \U0001f468\u200d\U0001f4bc \U0001f4c8 \U0001f4b8 (@itsKostasWithK) January 16, 2021
The story of the man who put the 'Ponzi' in 'Ponzi scheme'
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List of Educational Threads on Financial Independence and Investing for Beginners#FinancialIndependence #financialeducation #financialfreedom #investing
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1/ Financial Freedomhttps://t.co/8j5KG5ioFK