Charles Ponzi Scheme Research Paper

805 Words4 Pages
The term “Ponzi scheme” originates from Charles Ponzi who was born in 1882 in Parma, Italy. Charles Ponzi was the infamous man who gave out returns with other investors' money. Ponzi was arrested on August 12th, 1920 after running a highly profitable and expansive investment scheme. Ponzi was charged with 86 counts of mail fraud. Ponzi owed an estimated 7 million dollars while he pleaded guilty to mail fraud. Subsequently, Ponzi spent 14 years in prison and died on January 18, 1949, in Rio de Janeiro, Brazil. The details of the infamous swindler early life are difficult to verify. However, it is commonly believed that he was born in Parma, Italy. According to sources he attended the University of Rome La Sapienza. Charles immigrated to the…show more content…
His famous line is: "I landed in this country with $2.50 in cash and $1 million in hopes, and those hopes never left me." In order to pull off these types of schemes the person running it has to be likable. He has to have the charm and “wow” factor so people will trust him and want to invest with him. That is exactly who Ponzi was. Charles Ponzi’s charisma and confidence would eventually help him execute one of the greatest financial schemes in history. He started out working odd jobs and in 1907, moved to Montreal, where he found a job as a teller at Bank Zarossi. The bank was formed to cater to the new Italian immigrant population, charging high interest rates which made it hard for the poor immigrants to pay back. Consequently, Bank Zarossi went bankrupt because of bad loans and Charles Ponzi was left penniless. Soon after, Ponzi was sentenced to three years in a Quebec prison after he was caught forging a bad check. He then wrote a letter to his mother back in Italy stating that he was working at a Canadian prison instead of being a prisoner. Ponzi was then released from jail after paying his time but sure enough got involved in yet another criminal
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