Charles Ponzi - An International Con Man
By | February 18, 2019
There are many people in society who try to “get rich quick.” Taking shortcuts to fame and fortune rather than trying to build up their fortunes over time through hard work and achievement. They use various methods and schemes including what are called “Ponzi” schemes. The particular method known as “Ponzi” schemes actually originated from a con man named Charles Ponzi. He was from the early 1900s.
The Ponzi scheme is a method of fraud where investors are persuaded to invest in a product or service and are led to believe they will receive profits in the future. What they do not know is that their profits are coming from future investors.
This is the type of scheme that Charles Ponzi used back in 1918 when his previous scams had failed. He had received a letter from a company in Spain that included an international reply coupon (IRC). Back then there were coupons that could be exchanged for priority airmail postage stamps from another country. Ponzi figured out he could buy these IRCs (International Reply Coupons) in one country and exchange them for more expensive ones in another country, thereby obtaining a profit. He hired agents in other countries to buy the IRCs for him and send them to him, which he would, in turn, sell off.
Greed set in, and in an attempt to make more money, he started bringing in investors by promising them a 50% return on their investment in 45 days or 100% return in 90 days. He planned to pay them by using money collected from other investors, which worked really well for a while.