A Ponzi scheme is essentially an investment fraud wherein the operator promises high financial returns or dividends that are not available through traditional investments. Instead of investing victims’ funds, the operator pays “dividends” to initial investors using the principle amounts “invested” by subsequent investors.
The Ponzi scheme generally falls apart when the operator flees with all of the proceeds, or when a sufficient number of new investors cannot be found in order to allow the continued payment of “dividends.”
Home Business Today: What is a Ponzi Scheme?
January 22, 2007 by Ty | 0 Comments
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