Before the infamous Charles Ponzi was discovered for the flim-flam villain he really was, not a lot was known about Ponzi schemes. He’s the guy that lent his name to the offensive act of scam and robbery upon the innocent. There are hundreds of different scammers out there. Ponzi, or pyramid schemes can be so brilliantly organized and presented that they can fool the most savvy business investors. These are some of the most infamous con artists and ponzi schemes of all time.
Charles Ponzi, the originator of the Ponzi scheme
Ponzi was an immigrant from the country of Italy. He is one of the most well known con artists in the country. He set up a business that included the purchase and sale of postal coupons. He guaranteed that investors would receive a return of fifty percent on their investment within a 45 day period of time. Those who got in on the bottom floor made as much ass three times their initial investment. This gave Ponzi the proof he needed to advertise the business with hard and legitimate proof. The Securities Exchange Company helped him to amass more than forty thousand investors which netted Ponzi a cool million dollars within just three short hours. The total investment of $15 million was made to his “business” scheme. It later came to light that Ponzi had been paying investors with the money that came in as new investors took a chance. It became obvious that the newer investors had just been scammed out of their money and would never receive a return or anything back from their original investment. Ponzi skipped town after being sentenced to 14 years in prison. He landed in Brazil where he became ill and died in poverty. Prior to his death, he gave a full confession of his willful criminal activity.
Madoff is the second most notorious Ponzi scammer who absconded with $50 billion in ill gotten gains. He operated the largest known Ponzi scheme in all of history. He started the operation in the 1070s and kept it on a roll for a number of years. He was NASDAQ’s former chairman which put him in the perfect position to develop his system. He ruthlessly tricked some of the richest and most business savvy business people in the world. He demanded a minimum investment of $20 million to secure a place in his “business” deal. It didn’t help his victims that Madoff had earned a reputation for being a fair business man with the highest of ethical standards. His record was impeccable until he was caught. The Bernard L. Madodff Investment Securities LLC seemed like a solid investment deal but it turned out to be another Ponzi scheme.
Dona Branca dos Santos was known as the People’s banker. Although she was impoverished when she first opened her own bank, she quickly became wealthy. In 1970, Dona opened a bank that she claimed was designated for the poor workers of Portugul. She offered the high interest rate of ten percent return a month. Poor people saw this as an amazing deal and the thousands that invested in the bank didn’t stop to think that it could be too good to be true. It did work for about fourteen years. When officials discovered that she was really operating a Ponzi scheme, she was arrested and served ten years in jail.
Sergey Mavrodi is one of the most famous Ponzi scammers in history. He even managed to get elected to the Russian Parliament because of his popularity. It was estimated that his scheme lured in a million people, according to investigators’ evidence. When Mavrodi heard this figure, he brazenly scoffed and proudly refuted the claim, insisting that he had duped closer to two million people.
The scam took place in the 1990s when the MMM company guaranteed that the dividends would pay out a thousand percent on investments. They even had the nerve to advertise this publicly through television advertisements. The company hauled in a mind boggling $11 million a day in its prime. The scam went on for five years and during this time, Mavrodi skimmed off $1.5 billion in personal profits before the police raided his offices and he was charged with tax evasion.
Because he was a diplomat, he received immunity which allowed him to pay back the funds he had scammed from the public. His immunity was revoked and he skipped town, but was captured in 2003. For his crimes, Mavrodi only spent 54 months in jail and paid a fin of $390.