PONZI SCHEME
A Simple Explanation of Basic Concepts
Definition
A Ponzi Scheme is a fraudulent investment
scam that pays returns to investors from their
own money or from m...
Working of a Ponzi Scheme
1 | A Fraudster Places an advertisement for a non-existent
investment that offers extra-ordina...
Working of a Ponzi Scheme
5 | Unfortunately, because Ponzi Schemes are unauthorized
and make no profits, you are very un...
How to Recognize a Ponzi Scheme
1. If you are considering any type of investment, always remember,
if its too good to be...
Steps to be taken by Victims
1. FSA (Financial Services Authorities) regulates companies that
offer investments to publi...
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Ponzi scheme - A Simple Explanation of the Concept

This presentation gives a short and simple description of the Ponzi Scheme and the ways to prevent such frauds.
Published on: Mar 4, 2016
Published in: Economy & Finance      
Source: www.slideshare.net


Transcripts - Ponzi scheme - A Simple Explanation of the Concept

  • 1. PONZI SCHEME A Simple Explanation of Basic Concepts
  • 2. Definition A Ponzi Scheme is a fraudulent investment scam that pays returns to investors from their own money or from money paid in from subsequent investors – rather than from profit it actually makes
  • 3. Working of a Ponzi Scheme 1 | A Fraudster Places an advertisement for a non-existent investment that offers extra-ordinary returns in a short time After receiving the promised returns on their investment, the first investor starts to spread the word to family and friends. The scheme gains credibility | 2 3 | Because there is no actual investment vehicle, there are no profit. The first investor is paid from the money of the other investors
  • 4. Working of a Ponzi Scheme 5 | Unfortunately, because Ponzi Schemes are unauthorized and make no profits, you are very unlikely to recover any lost investment. Typically the fraudster will vanish with investors money or the scheme will collapse as investors realize that they are not receiving the returns they were promised | 6 7 | Because of non-regulation of investment market, these frauds become rich and the investors poor
  • 5. How to Recognize a Ponzi Scheme 1. If you are considering any type of investment, always remember, if its too good to be true, it probably is. High returns can only be achieved with high risk. 2. Ponzi fraudster use vague technical jargon to describe their non-existent investments. 3. The bankers will try to pressurize you. Take decisions with patience and only after checking through all the documents. 4. Resolve any suspicions you might have about the scheme’s authenticity by investigating the company status and contact details.
  • 6. Steps to be taken by Victims 1. FSA (Financial Services Authorities) regulates companies that offer investments to public. 2. Call FSA Helpline Number, 0300 500 5000 3. If you have given your bank account details to any such investment company, immediately contact the bank and deactivate your account. 4. Every decision you make in any scheme, make sure you have written and signed communication with you. Make copies of the same and keep them with you. 5. Spread about such frauds among other people and friends. AND THE MOST IMPORTANT ACT SMART AND PREVENT SUCH FRAUD ACTIVITIES

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