Scam in which a gullible group is enticed with the promise of very high returns in a very short time, but is based on paying off the early 'investors' from the cash from (hopefully ever increasing number of) new 'investors.' The whole structure collapses when the cash outflow exceeds the cash inflow. The originators of the scheme, however, usually disappear with large sums a few days before ... Read more

USAGE EXAMPLE

Federal investigators began looking into the company's affairs on suspicion of running a Ponzi scheme after seeing months of abnormally high returns without any visible product or service offered.