What is a PONZI scheme???

October 11, 2006 2:33am CST
Can anyone explain?? I hear this word a lot
2 responses
@bazranz (200)
1 Nov 06
A ponzi is, in most countries, an illegal investment program. It works by the program owner promising to pay investors double their investment within a stated time. Once the agreed time has been reached, there is then a choice of taking the money, or re-investing it to double again. The problem is thatthe time allowed is not long enough for any investment to double, so when members wish to withdraw their money, they are paid from the investments of the people following them in to the program. Then the time comes, when those who invested last cannot even get their original investment back. It works for a few, but not the majority.
@krishna183 (2286)
• India
21 Oct 06
even iv heard this term quite a llot .. dont know what it means