Ponzi scheme

British  

/ ˈpɒnzɪ /

noun

1. a fraudulent investment operation that pays quick returns to initial contributors using money from subsequent contributors rather than profit

---

Etymology

Origin of Ponzi scheme

After Charles Ponzi , who famously perpetrated such a scheme in the United States of America in the early 20th century

Example Sentences

“I mean, you take a 10%, 20%, 15% of a guy’s NIL money, that’s Bernie Madoff level,” Cronin said Friday, referencing the crooked financier who was convicted in a massive Ponzi scheme.

From Los Angeles Times

Jamie Dimon, ever the mouthpiece for traditional finance, maligned the industry as a fraud, a Ponzi scheme and a collection of pet rocks, among other colorful descriptors.

From The Wall Street Journal

He knew something that others did not: that he was operating a Ponzi scheme.

From MarketWatch

This is a fictitious Ponzi scheme.’”

From Literature

They had the essential feature of a Ponzi scheme: To maintain the fiction that they were profitable enterprises, they needed more and more capital to create more and more subprime loans.

From Literature