Carlo Ponzi was born on March 3, 1882 in Lugo, Italy. At the age of 21, he entered the United States with empty pockets and managed to become a financier and swindler, to whom nearly 40,000 investors gave him 20 million dollars, the equivalent of about 250 million today. From prison he kept promising them: “When I get out I will pay you back every penny.” He was the man who invented the most famous pyramid scheme in history.
Some of his biographers say that he was an ambitious student who wanted to prosper. Others say that he was a rogue like any other, with little future, whom his family shipped to America to get rid of him.
But in 1903, Carlo Ponzi was just another desperate man. He came to the United States among hundreds of immigrants tempted by the fashionable phrase at the time: “Everything is possible in America.”
The State Ponzi Scheme
The most famous pyramid scheme
What was your system about? Carlo Ponzi promised his clients a 50% profit within 45 days or 100% within 90 days. This, just by buying discontinued postal coupons in other countries and redeeming them at their nominal value in the United States, as a form of arbitration, according to the publication reviewed in Infobae.
Hundreds of people who were waiting anxiously with their money in hand had to return home disappointed, when Ponzi announced that he would no longer take deposits. By then, this Italian who had immigrated to the United States with almost empty pockets had become a millionaire.
“I came to this country with two dollars and 50 cents in cash and a million dollars in hopes and those hopes never left me,” Carlo Ponzi told The New York Times in late July 1920.
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Jail was his destiny
According to BBC News, his crisis began when financial analyst Clarence Barron, commissioned by the Boston Post, published a report stating that, despite the extraordinary interest paid, Carlo Ponzi did not reinvest a single penny of his enormous benefits in the company.
It was calculated that 160 million coupons in circulation were needed to cover the obligations contracted, when in reality there were only 27 thousand.
A crowd of angry investors showed up at the offices and, after suing him, Ponzi was put in prison on November 1, 1920 and found guilty of fraud. He was sentenced to five years in prison.
He was released three years later and was sentenced to nine more, serving a total of 14 years according to The New York Times.
Since he was on probation, he decided to change his mind and flee to the state of Florida, where he launched another scam. However, by then his bad reputation had already spread.
sunset comes
Ponzi apparently managed to overcome that stigma in the final years of his life, when he went to work for an Italian airline in Brazil.
The company closed due to the start of World War II, and so he tried to make a living by setting up a hot dog stand, which failed. Later, he earned some income by teaching English and French, which was barely enough to survive.
On January 18, 1949, now seven decades ago, he died in a welfare room of a hospital in Rio de Janeiro from a stroke. He was 66 years old and completely broke.
The name of Carlo Ponzi became part of economics textbooks for having devised what is known as the pyramid scheme. (I)
Source: Eluniverso
Paul is a talented author and journalist with a passion for entertainment and general news. He currently works as a writer at the 247 News Agency, where he has established herself as a respected voice in the industry.
