History Main / Ponzi

* Due to a heavy reliance on housing construction, development, realty, and allied trades, the entire economy of the state of [[OnlyInFlorida Florida]] before the housing crisis was described as this; a much larger-than-average percentage of the people who already lived in Florida made their living housing the people who were moving into Florida.

* Speculative bubbles are essentially self-running Ponzi schemes. They occur when people start buying something (say, real estate) because they think it's a good investment, causing prices to go up, causing other people to buy more real estate, causing prices to go up, etc. The catch is that nobody actually ''wants'' the thing they're buying, they just want to make money by selling it after the price goes up - and the only people they can sell it to are other people who're trying to cash in. The bubble is said to have "popped" when people stop buying into it, causing people to start trying to cash out by selling off their investments, causing the price to drop, causing people to sell off their investments, causing the price to drop, etc. This is why a lot of people during the US housing market crash of 2007-08 commented that the economy of UsefulNotes/{{Florida}} in the leadup to the crisis had been a giant Ponzi scheme, as the state had been running very heavily on housing and often not much else.

* In ''FanFic/TheWeaverOption'' the Chaos Gods are able to exploit the Warp's temporal mutability in order to feed on souls and acts that don't exist at the moment. This in turn allows them to have sufficient strength to position themselves in order to generate more souls to feed upon. However there is a caveat to this in that the possibility of a soul existing must never become zero as it would cause a paradox. [[spoiler:Slaanesh]] runs afoul of this when Taylor launches a raid on [[spoiler:Commorragh]] whose denizens, especially [[spoiler:Asbrudael Vect]], represent a major source of future souls. [[RetGone Entire legions of daemons cease to have ever existed]] as the battle progresses and [[spoiler:Slaanesh]] weakens drastically.

* ''The Wizard Of Lies'' is an HBO made-for-cable movie about the infamous scheme orchestrated by Bernie Madoff, with Creator/RobertDeNiro in the leading role. (Watch the official trailer [[https://www.youtube.com/watch?v=4G2carVhVJk here]].)

*** Mavrodi's [[RefugeInAudacity persistence]] deserves mention. He still insists that he is a victim of the government smear campaign and that his scheme would have ultimately profited everybody involved. After doing his time he declared in 2011 that he would create another pyramid, MMM-2011, to pay the money lost in the previous one. When it collapsed, he again blamed the government, promised to sue them for damages, tried to run for a place in the Opposition Coordination Council, and tried to start '''yet another''' pyramid, MMM-2012.

* In the season 2 finale of ''Odd Mom Out'' the ultra-wealthy of New York discover the man they've been investing in "Pulled a Madoff." Keeping with the show's satirical tone, many of these people are still very well off but consider being dropped into a lower tax bracket to be the same as poverty. Ironically, main character Jill (long looked down on for not being as rich as her neighbors) and her husband are okay as they were never wealthy enough to be invited to invest in the guy. Sadly, Jill's mother-in-law put in almost everything she had and is now flat broke.

Most Ponzi schemes use many more than two people, and in fact depend on a constant influx of new people putting in money to pay the other ones. Indeed, a common name for Ponzi schemes is "rob Peter to pay Paul", as the principle is the same--except that today's Peter is tomorrow's Paul, until this grows unsustainable. May also be referred to as a Pyramid Scheme, although technically that's a different kind of scam.[[note]] The difference being that instead of a central figure manipulating the money to keep the marks satisfied, each entrant to a Pyramid scheme is expected to recoup their own investment by recruiting other investors under them in the structure. The further up you are, the more you make, but the bottom tier will never see a profit. Depending on how many people you are expected to recruit, pyramids can quickly require more people than the entire world population.[[/note]] The largest example ever was the $64.8 ''billion'' (in pretend money, anyway) collapse of the firm of Bernie Madoff, whose operation was a classic Ponzi scheme.

* ''Film/AboutSchmidt'' has Randall, the fiancee of the daughter of the protagonist Warren Schmidt, try to entice the latter into buying on an investment opportunity. Schmidt being an experienced actuary who is meticulous about avoiding poor choices in investment and high levels of risk, is skeptical of joining. Randall doesn't even mention what kind of product the opportunity is tied to. A few weeks later, Schmidt waits for the perfect opportunity of when to ask Randall how did the opportunity go: at a dinner table with Randall's friends and family. Randall's brother reveals that it was a pyramid scheme that cost him $800. This proves Schmidt's suspicions were correct.
* ''Film/TheOtherGuys'' has CorruptCorporateExecutive [[EvilMatriarch Pamela Boardman]] and her [[EvilBrit British]] partner-in-crime Sir Ershon conducting such a scheme. After he attempts to defect with the money, she sends mercenary hitmen after him (and the protagonists, who just happened to arrest him on a minor construction fraud). [[spoiler:The story ends with him and the assassins arrested, [[KarmaHoudini while Boardman receives a bailout from the American government]]]]. The ending credits give the viewers an {{Edutainment}} section about what a Ponzi-scheme is and how it works, complete with the appropriate statistics of the 2008 financial crisis.

* In the Creator/ArthurHailey novel ''The Moneychangers'' this is what the seemingly powerful Sunatco corporation has turned into. The company has been suffering massive losses but hiding it with fancy bookeeping. They keep themselves afloat by conning banks and other companies into giving them "loans" and then more loans to pay off their older debts. One example is a set of loans of $80 million to be paid off over forty years. But on the Sunatco books, that's cited as $80 million of profit. However, they're finally hitting the limit of borrowing and thus Sunatco is a house of cards ready to collapse.

* ''Literature/ASongOfIceAndFire'' has something suspiciously Ponziesque going on, care of Lord Petyr "Just-a-Reminder-that-I'm-Kind-of-[[IntrepidMerchant Braavosi]]" Baelish. Tyrion gets a peek at it when he gets hold of the accounts of the Seven Kingdoms, and ''immediately'' spots fraud -- including the relatively easily detected petty aspects of, say, paying more prison guards than actually exist with the gold ''obviously'' going somewhere else. But, there're more than a few hints that whatever Littlefinger has been up to as Master of Coin includes self-sustaining pockets of "investment" dotted about the Seven Kingdoms quite indebted to him, along with more traditional forms of till-dipping, economic speculation, padding and bribery. Tyrion ''knows'' there's more to find than the penny-ante layers of smokescreen he manages to pry apart, but [[spoiler: gets removed from the Seven Kingdoms' side of the board in a suspiciously well-timed manner before he can really start getting to the heart of it.]]

* One episode of ''Series/TwoAndAHalfMen'' has Alan accidentally sets up a pyramid scheme by asking his friends and family for money for advertisements and paying them back with each other's money. When he realizes what he has done, he decides to just go with it and spends the rest of the money on himself. In the end he is saved because he is bribed by [[spoiler:Rose]] to keep quiet about [[spoiler:her fake marriage]] and can pay everyone back.

* Charles Ponzi himself is a HistoricalDomainCharacter in the ''Series/MurdochMysteries'' feature length ChristmasEpisode "Home for the Holidays", where his victims include the Brakenreids.

* ''Ponzi Scheme'' has up to five players running their own Ponzi schemes. At the beginning of a round each player takes out a loan that they have to pay interest on every few rounds. The loans are the only source of money in the game so the players have to take ever increasing loans in order to pay back what they owe on previous loans. The players have to manage keeping their own scheme running while amassing off-shore personal wealth. However, none of the schemers are willing to get out early so the schemes get bigger and bigger until one collapses and the other players make a RunForTheBorder with their ill-gotten gains.

*** Mavrodi's [[RefugeInAudacity persistence]] deserves mention. He still insists that he is a victim of the government smear campaign and that his scheme would have ultimately profited everybody involved. After doing his time he declared in 2011 that he would create another pyramid, MMM-2011, to pay the money lost in the previous one. When it collapsed, he again blamed government, promised to sue them for damages, tried to run for a place in the Opposition Coordination Council, and tried to start '''yet another''' pyramid, MMM-2012.
* Adjusting for inflation and overall world economic growth, the all-time biggest Ponzi scheme (so far) was that perpetrated by [[http://en.wikipedia.org/wiki/Ivar_Kreuger "The Match King" Ivar Kreuger]]. This is somewhat complicated by the fact that the whole mess was basically a combination of a Ponzi scheme, other not-really-legal financial trickery, ''legal'' financial trickery and genuine successful investments. Add in unclear book-keeping, and the exact size of the Ponzi scheme becomes a tad unclear.

* Banks are under as much regulation as they are because they are, essentially, operating a legal as-close-to-Ponzi-scheme-without-being-it as possible. A bank agrees to increase your money if you lend it to them, and use that money, along with that borrowed by its other clients, to give loans to those it deems capable of repaying it. Nearly no bank in existence today has enough cash-on-hand to pay back every single of its clients should they suddenly decide to cash out, but they are allowed to spend money that isn't theirs because it ''massively'' increases the available funds available to an economy, and that economy, in turn, provides the additional wealth needed to pay its clientele. As long as trust in the system is preserved, it works, and as such preserving that trust is paramount for just about any nation - therefore, banks are under ''massive'' scrutiny to ensure everything is done by the book, because they're just one step away from it becoming an actual Ponzi scheme.

* Diploma mills. These are (alleged) universities or colleges that are ''not'' accredited, but pretend that they are, and they will give anyone a diploma as long as they send payment, luring them with promises of new career opportunities, higher salaries, etc. The school (which may not even exist) walks away with the mark's money, while the mark walks away with a PhonyDegree (that they may not even know is fake, depending on how things played out), which often comes back to bite them later (while the alleged school, meanwhile, is long gone).
** [[https://www.cracked.com/personal-experiences-2246-i-teach-at-for-profit-college-heres-why-its-scam.html Arguably, for-profit colleges (accredited or not) can be considered this, too]].

Most Ponzi schemes use many more than two people, and in fact depend on a constant influx of new people putting in money to pay the other ones. Indeed, a common name for Ponzi schemes is "rob Peter to pay Paul", as the principle is the same--except that today's Peter is tomorrow's Paul, until this grows unsustainable. May also be referred to as a Pyramid Scheme, although technically that's a different kind of scam.[[note]] The difference being that instead of a central figure manipulating the money to keep the marks satisfied, each entrant to a Pyramid scheme is expected to recoup their own investment by recruiting other investors under them in the structure. The further up you are, the more you make, but the bottom tier will never see a profit. Depending on how many people you are expected to recruit, pyramids can quickly require more people than the entire world population.[[/note]] The largest example ever was the $64.8 ''billion'' (in pretend money, anyway) collapse of the firm of Bernie Madoff, whose operation was a classic Ponzi scheme. The Reverse Ponzi Scheme is actually a form of the DelayedWire con.

* [[https://en.wikipedia.org/wiki/Allen_Stanford Allen Stanford's]] scheme gave him de-facto control over Antigua and grossed over $8 billion from swindling clients from the U.S. and Latin America. His "bank" profited from its customers through its [=CDs=][[note]] Certificates of Deposit[[/note]], meaning people placed their life savings at the mercy of Stanford and his free-spending ways. While he spent some money building Antigua's infrastructure and donating to charities like St. Judes, most of the money was spent lobbying politicians as well as wining, dining, and ferrying himself on private jets and yachts. It was not until 2009 when the [=SEC=] raided Stanford's Houston headquarters and ordered his arrest. ''Podcast/{{Swindled}}'' has an overview of Stanford's elaborate Ponzi scheme, [[https://youtu.be/uIscEWALpHw?t=710 which you can listen to here.]]

** Several big cases hit [[UsefulNotes/TheNewRussia New Russia]] a few years earlier, but without such drastic consequences, since the victims were only several percent of the population. Several more or less legit companies (trading in electronics, real estate, telemarketing and such) decided that selling and reselling their shares is much more profitable and inflated the prices beyond any reason. Sergei Mavrodi's [[http://en.wikipedia.org/wiki/MMM_%28Ponzi_scheme_company%29 MMM]] is the most famous, both because of its ad campaigns and for being the first to collapse.

* There was a scandal in Mexico involving community savings banks. {{The mark}}s -- most of them impoverished workers with only a few dollars of savings, whose only education was elementary school, and who made up ''roughly 40% of Mexico's population'' -- were lured into legitimate-looking institutions, were promised gigantic interests around 40%, dazed and confused with ebullient [[{{Technobabble}} econobabble]], and then they would pony up their entire life savings, thinking it would finally make them rich. Then the banks played upon the existing corruption and elitism in the Mexican government, and proceeded to bribe the entire judicial system into [[KarmaHoudini protecting them once it was time to get away]]. After a while, all these "savings banks" suddenly closed, and their owners fled to where noone could find them. ''Cue the occasional Molotov bottle thrown against Mexico's banking authorities.''
* Due to a heavy reliance on housing construction, development, realty and allied trades, the entire economy of the state of [[OnlyInFlorida Florida]] before the housing crisis was described as this; a much larger-than-average percentage of the people who already lived in Florida made their living housing the people who were moving into Florida.

* "5 wallets" scheme in [=PayPal=] and similar systems, similar to OlderThanRadio "5 addresses" above. Explicitly prohibited by every payment system, but still widely advertised by spammers. Like its predecessor, this is generally an outright fraud, where all "previous participants" are really the same man (it's easier to set up one person with five Paypal accounts than find five addresses to use).
* In the mid to late 2000s, a number of American SoapOpera actors got involved in [=MLMs=] and sold both products and sales buy-in kits at fan events. Rumors flew that on the set of ''Series/GeneralHospital'' actors who objected because they found the practice exploitative were socially shunned by the rest of the cast and threatened with bad storylines. Ingo Rademacher, who plays Jax, was particularly [[https://www.lazymanandmoney.com/monavie-scam/comment-page-30/ vocal about his objections]] to a juice-selling MLM and even sent an email to the cast and producers outlining why. In the end, however, producers decided to clamp down on the practice as it was hurting the already struggling genre's reputation.
* Banks are under as much regulation as they are because they are, essentially, operating a legal as-close-to-ponzi-scheme-without-being-it as possible. A bank agrees to increase your money if you lend it to them, and use that money, along with that borrowed by its other clients, to give loans to those it deems capable of repaying it. Nearly no bank in existence today has enough cash-on-hand to pay back every single of its clients should they suddenly decide to cash out, but they are allowed to spend money that isn't theirs because it ''massively'' increases the available funds available to an economy, and that economy, in turn, provides the additional wealth needed to pay its clientele. As long as trust in the system is preserved, it works, and as such preserving that trust is paramount for just about any nation - therefore, banks are under ''massive'' scrutiny to ensure everything is done by the book, because they're just one step away from it becoming an actual ponzi scheme

* Diploma mills. These are (alleged) universities or colleges that are ''not'' accredited, but pretend that they are, and they will give anyone a diploma as long as they send payment, luring them with promises of new career opportunities, higher salaries, etc. The school (which may not even exist) walks away with the mark's money, while the mark walks away with a fake degree (that they may not even know is fake, depending on how things played out), which often comes back to bite them later (while the alleged school, meanwhile, is long gone).

* Diploma mills. These are (alleged) universities or colleges that are ''not'' accredited, but pretend that they are, and they will give anyone a diploma as long as they send payment. The school (which may not even exist) walks away with the mark's money, while the mark walks away with a fake degree (that they may not even know is fake, depending on how things played out), which often comes back to bite them later (while the alleged school, meanwhile, is long gone).

* A company called DC Solar that supposedly manufactured, leased, and sold solar generators was found to be operating a Ponzi scheme in 2018. The company claimed they had manufactured and leased/sold over 12,000 generators, when in fact less than half that number had actually been built. The owners, Jeff and Paulette Carpoff, intentionally lied to investors in order to obtain money to be used on their own endeavors, which included 150 luxury cars, a private jet, and NASCAR sponsorship. Not only do Jeff and Paulette face up to 30 and 15 years in prison respectively, but NASCAR team Chip Ganassi Racing was forced to close their Xfinity Series team due to lack of sponsorship. (DC Solar sponsored the team before the raid on the company's headquarters) One of Chip Ganassi's (former) drivers Kyle Larson also had one of his Xfinity Series cars seized by the FBI due to being sponsored by DC Solar. On top of all that, the Carpoffs owe various racetracks that NASCAR races at thousands of dollars in unpaid sponsorships.

* In one episode of ''Series/BrooklynNineNine'', both Jake and Charles accidentally join "Nutriboom," a shady company that's one half multi-level marketing scheme and one half ChurchOfHappyology.

* In the season 2 finale of ''Odd Mom Out'' the ultra-welathy of New York discover the man they've been investing in "Pulled a Madoff." Keeping with the show's satirical tone, many of these people are still very well off but consider being dropped into a lower tax bracket to be the same as poverty. Ironically, main character Jill (long looked down on for not being as rich as her neighbors) and her husband are okay as they were never wealthy enough to be invited to invest in the guy. Sadly, Jill's mother-in-law put in almost everything she had and is now flat broke.

* In ''LightNovel/WelcomeToTheNHK'', Satou is sucked into a multilevel marketing scheme by an old friend of his. Misaki and Yamazaki force him to confront his friend to get out of it, only to be suckered in themselves

* Banks are under as much regulation as they are because they are, essentially, operating a legal as-close-to-ponzi-scheme-without-being-it as possible. A bank agrees to increase your money if you lend it to them, and use that money, along with that borrowed by its other clients, to give loans to those it deems capable of repaying it. Nearly no bank in existence today has enough cash-on-hand to pay back every single of its clients should they suddenly decide to cash out, but they are allowed to spend money that isn't theirs because it ''massively'' increases the available funds available to an economy, and that economy, in turn, provides the additional wealth needed to pay its clientele. As long as trust in the system is preserved, it works, and as such preserving that trust is paramount for just about any nation - therefore, banks are under ''massive'' scrutiny to ensure everything is done by the book, because they're just one step away from it becoming an actual ponzi scheme[[note]]Banks don't entirely qualify as this trope, because of the FDIC, established in 1933 in response to the mass closure of banks due to the Great Depression. The FDIC insures, currently up to $100,000, any direct deposits made in banks with the weight of the US Government (specifically, the US Treasury). This guarantees that the average person's money will be safe in a bank, and greatly reduces the number of people pulling their money out in an economic downturn[[/note]].

* The Es'Teq of ''VideoGame/AgeOfWondersPlanetfall'' are a ScienceFantasy variation with [[LifeEnergy essence]] instead of mere money. The low-ranking members are promised immortality, but usually end up drained to death in the long run, while the High Lords get to live forever.

* In ''FanFic/TheWeaverOption'' the Chaos Gods are able to exploit the Warp's temporal mutability in order to feed on souls and acts that don't exist at the moment. This in turn allows them to have sufficient strength to position themselves in order to generate more souls to feed upon. However there is a caveat to this in that the possibility of a soul existing must never never become zero as it would cause a paradox that would drastically weaken the God. [[spoiler:Slaanesh]] runs afoul of this when Taylor launches a raid on [[spoiler:Commorragh]], whose denizens, especially [[spoiler:Asbrudael Vect]] represent a major source of future souls. [[RetGone Entire legions of daemons cease to have ever existed]] as the battle progresses and [[spoiler:Slaanesh]] weakens drastically.

* Banks are under as much regulation as they are because they are, essentially, operating a legal as-close-to-ponzi-scheme-without-being-it as possible. A bank agrees to increase your money if you lend it to them, and use that money, along with that borrowed by its other clients, to give loans to those it deems capable of repaying it. Nearly no bank in existence today has enough cash-on-hand to pay back every single of its clients should they suddenly decide to cash out, but they are allowed to spend money that isn't theirs because it ''massively'' increases the available funds available to an economy, and that economy, in turn, provides the additional wealth needed to pay its clientele. As long as trust in the system is preserved, it works, and as such preserving that trust is paramount for just about any nation - therefore, banks are under ''massive'' scrutiny to ensure everything is done by the book, because they're just one step away from it becoming an actual ponzi scheme.

** In Season 6, Alexis gets hired to promote a Soul-Cycle-like fitness company called Elevation, and she convinces most of the women of the town to sign up for their stair-stepper fitness classes. [[spoiler; Turns out, it isn't just a MLM/Pyramid scheme but a full-on cult that promises to elevate its members to something called The Gateway and rendezvous with an alien ship. Alexis helps her friends escape through the back door.]]

* ''Series/SchittsCreek'': In Season 1, a former SoapOpera colleague of Moira's sends her a start-up kit for a shady MLM called Allez Vous. Moira dismisses it as a scam but David is immediately taken in by the get rich quick promises of the brochure. Mother and son attempt to make a go of the scheme, only to discover that nearly everyone in the town had already fallen for it a few years prior and were already sales associates and managers who had found little market for the products.

* The Eve Intergalactic Bank in ''VideoGame/EveOnline'', the largest scam in that game's history (seeing the theft of 671 ''billion'' ISK, which translates to ''$119,000'' at the exchange rates of the time), was one of these. The man who predicted that it was a scam was also, before that bank's collapse, the previous record holder for the title of "largest scam in ''Eve''." Many ''Eve'' players take a warped sense of pride in how friendly their game is to scammers.

* A re-enactment and explanation of the original Ponzi scheme worked is shown in the "Scams" episode of ''Series/TheWhiteRabbitProject''.

* In one episode of ''Series/BrooklynNineNine'', both Jake and Charles accidentally join "NutriBoom," a shady company that's one half multi-level marketing scheme and one half ChurchOfHappyology.

* In one episode of ''Series/Brooklyn99'', both Jake and Charles accidentally join "NutriBoom," a shady company that's one half multi-level marketing scheme and one half ChurchOfHappyology.