In 1920, a five-foot-two-inch rogue from Italian descent raked in an estimated $15 million in eight months by convincing tens of thousands of investors in Boston that he had the ultimate Get Rich Quick scheme. His name? Mr Charles Ponzi.
Like taking candy from a baby, Mr Ponzi told clients that they would get 50% on their investment in International Postal Reply Coupons within 90 days. Right enough, early investors received payouts as promised - but not because of any clever wealth-creating strategy. The only activity here was the shuffling of money from new clients to old ones. As long as new investors were lured in, there was money to go around. But when the clients stopped coming, Ponzi’s scheme collapsed, and he was forced to pay investors several million dollars.