A Ponzi scheme is a fraudulent investment operation that pays returns to its investors from their own money or the money paid by subsequent investors, rather than from profit earned by the individual or organization running the operation.
A Ponzi scheme is a fraudulent investment operation that pays returns to its investors from their own money or the money paid by subsequent investors, rather than from profit earned by the individual or organization running the operation.
Anti-money Laundering:-
The process of disguising the proceeds of crime in an effort to conceal their illicit origins and legitimize their future use. Its main objective is to conceal true ownership and origin of the proceeds, a desire to maintain control, a need to change the form of the proceeds.Techniques used can be simple, diverse, complex, but secret.
Presentation on Financial Crimes. Money is one of the most important reasons behind all forms of crime whether Cyber or Internet crimes, Physical or Theft crimes. With the advancement of technology the crime has not decelerated but only esteemed and many more new techniques were by people and they were popularly called as Blackhat hackers. In this presentations we give an over view of the whole scenario.
Money Laundering and Terrorist Financing in a Nutshell: Chapter OneMd. Moulude Hossain
Financial Crime is an increasing concern for all financial institutions, which is developing rapidly and equally together with technology. May be not limited to money laundering and terrorist financing, these two form of financial crime deserve to be attended with utmost care.
The evolving challenges of Money Laundering (ML) and Terrorist Financing (TF) lead the evolution of anti-money laundering and counter terrorist financing convention and regulations. These conventions give birth of several international organizations to combat the impact of ML and TF.
Presentation given for Crowe Horwath Auditor's training session on 26/03/2016.
AML regulations are applicable to professional service providers also. See the presentation for more information
money laundering and corruption
,
what is money laundering
,
suspicious transaction means such transaction:
,
what are some of the challenges
,
why and how to combat money laundering
,
money laundering
,
money laundering process
,
mlpa-2012
,
incentives to launder
This is the deck that accompanied Dave Kochbeck's webinar on July 10, 2014.
In the webinar he guided founders of all stripes through the perfect pitch. Determine what are the most important touch-points to prepare for, what you should be aware of and what you should focus in on and highlight about your exciting company. From founders seeking pre-seed to late seed funding, this is the most important Webinar you should attend.
Women 2.0's Webinars are a new event to promote new networks amongst the entire technology ecosystem in innovative cities around the world. This event is open to those who work, start, and fund tech companies. Both women and men are invited to attend.
To view our next webinar go here: http://women2.com/webinars
To apply for PITCH go here (Deadline July 31, 2014): http://bit.ly/1ojgVtj
Women 2.0 Fall Conference in San Francisco (September 30 - October 1, 2014): http://sf.women2.com
Anti-money Laundering:-
The process of disguising the proceeds of crime in an effort to conceal their illicit origins and legitimize their future use. Its main objective is to conceal true ownership and origin of the proceeds, a desire to maintain control, a need to change the form of the proceeds.Techniques used can be simple, diverse, complex, but secret.
Presentation on Financial Crimes. Money is one of the most important reasons behind all forms of crime whether Cyber or Internet crimes, Physical or Theft crimes. With the advancement of technology the crime has not decelerated but only esteemed and many more new techniques were by people and they were popularly called as Blackhat hackers. In this presentations we give an over view of the whole scenario.
Money Laundering and Terrorist Financing in a Nutshell: Chapter OneMd. Moulude Hossain
Financial Crime is an increasing concern for all financial institutions, which is developing rapidly and equally together with technology. May be not limited to money laundering and terrorist financing, these two form of financial crime deserve to be attended with utmost care.
The evolving challenges of Money Laundering (ML) and Terrorist Financing (TF) lead the evolution of anti-money laundering and counter terrorist financing convention and regulations. These conventions give birth of several international organizations to combat the impact of ML and TF.
Presentation given for Crowe Horwath Auditor's training session on 26/03/2016.
AML regulations are applicable to professional service providers also. See the presentation for more information
money laundering and corruption
,
what is money laundering
,
suspicious transaction means such transaction:
,
what are some of the challenges
,
why and how to combat money laundering
,
money laundering
,
money laundering process
,
mlpa-2012
,
incentives to launder
This is the deck that accompanied Dave Kochbeck's webinar on July 10, 2014.
In the webinar he guided founders of all stripes through the perfect pitch. Determine what are the most important touch-points to prepare for, what you should be aware of and what you should focus in on and highlight about your exciting company. From founders seeking pre-seed to late seed funding, this is the most important Webinar you should attend.
Women 2.0's Webinars are a new event to promote new networks amongst the entire technology ecosystem in innovative cities around the world. This event is open to those who work, start, and fund tech companies. Both women and men are invited to attend.
To view our next webinar go here: http://women2.com/webinars
To apply for PITCH go here (Deadline July 31, 2014): http://bit.ly/1ojgVtj
Women 2.0 Fall Conference in San Francisco (September 30 - October 1, 2014): http://sf.women2.com
To be able to distinguish among the five forms of entrepreneurial capital
To consider how to attract financing from your family and how to bootstrap a business
To identify how informal investors differ from other parts of the funding community
To differentiate between debt and equity as methods of financing
To examine commercial loans, social lending and public stock offerings as sources of capital
To understand the stages of venture investing
To study the market for venture capital and to review venture capitalists’ evaluation criteria for new ventures
To discuss the importance of evaluating venture capitalists for a ‘best fit’ selection
To discuss private placements as an opportunity for equity capital
To examine the business angel market
To describe new forms of entrepreneurial capital beyond financial capital
To be familiar with Islamic finance and micro-credit
To understand the criteria used by impact investors
To appreciate the need for raising natural capital as part of an entrepreneurial venture.
Paul Niederer - The Global Status of Crowdfunding, CSW Global14 Crowdsourcing Week
Presented at Crowdsourcing Week Global 2014 by Paul Niederer, CEO of ASSOB. Join us for CSW Global 2015! More Information: http://crowdsourcingweek.com/ and https://twitter.com/CrowdWeek
Exploring New Opportunities and Diversification Strategies in Alternative Investments - Presentation delivered by Cynthia G. Koury, Partner and Senior Vice President, CM Wealth Advisors at the marcus evans Private Wealth Management Summit Fall 2014 in Las Vegas.
My presentation with David Rose on the general framework of equity crowdfunding under the JOBS Act. This presentation is not updated for the most recent developments. Specifically, the SEC has missed certain of their congressionally mandated deadlines and therefore both general solicitation and equity crowdfunding are still not legalas of the date of this presentation. If you have additional questions, feel free to send me a tweet at 1billionagles or email me at kiranlingam@gmail.com.
Getting Your Venture "Game Ready" for FundingAndrew Tulchin
Triple bottom line efforts need capital. But securing this capital is often challenging, despite impactful value propositions and promising ROIs. Meanwhile, options for funding are expanding, creating a dizzying array of options for the entrepreneur. In this workshop, you’ll work with two experienced social enterprise funding advisors to get your efforts “game ready” for funding. You’ll learn how to package your venture to successfully raise the funds you need… and from the right type of capital source.
Angel investing is a great way to participate in the growing trend of entrepreneurship. Responsible investing is very important for the health of your portfolio and for your relationships with founders. Don't invest without understanding a few simple things. Equity investments are long term relationships. Investors must do their part to be good investment partners.
Top 10 charitable planning strategies for financial advisors 2020Russell James
This presentation gives the top approaches to helping your clients and growing your practice using charitable planning with special tips related to the new tax law. Participants will learn how to provide tremendous benefit to clients, while improving their own assets under management, with charitable planning. Topics include gifts from retirement plans, gifts of appreciated assets, the use of private foundations, and life insurance.
The Statistics & Psychology of Baby Boomer Lifetime & Legacy GivingRussell James
In this irreverent and entertaining slide deck, Dr. James reviews nationally representative data on Baby Boomers and their lifetime and legacy donations. Beyond simple statistics, this session demonstrates how these demographic realities should change how and when you communicate fundraising information to Boomers. If you want a slide deck based on hard data that goes beyond "just so" stories with obligatory pictures of Woodstock, Vietnam, and Neil Armstrong - then this is the place for you!
Using "natural philanthropy" in fundraisingRussell James
Charitable giving is not a modern invention of the industrialized world. It is a natural behavior as old as humankind. In this presentation, Professor James reviews scientific research from a range of disciplines to uncover the natural origins of philanthropy and translates these scientific concepts into effective fundraising strategies. Be prepared to see how theory and science can produce powerful, practical, real-world fundraising success.
Top 10 legacy fundraising strategies from scientific research: National data ...Russell James
After fifteen years in academic research (plus more than a decade in frontline planned and major gifts fundraising), Professor James brings together scientific results from economics, neuroscience, psychology, demographics, and other disciplines to present the ten most important and effective strategies for increasing fundraising success in planned gifts. Beyond just “war stories,” this presentation gives you a deep understanding of what works – and why – in effective legacy fundraising.
Natural philanthropy: How the natural origins of donor motivations drive powe...Russell James
Charitable giving is not a modern invention of the industrialized world. It is a natural behavior as old as humankind. In this presentation, Professor James reviews scientific research from a range of disciplines to uncover the natural origins of philanthropy and translates these scientific concepts into effective fundraising strategies. Be prepared to see how theory and science can produce powerful, practical, real-world fundraising success.
Top 10 charitable planning strategies for financial advisors under the new ta...Russell James
This presentation gives the top approaches to helping your clients and growing your practice using charitable planning with special tips related to the new tax law. Participants will learn how to provide tremendous benefit to clients, while improving their own assets under management, with charitable planning. Topics include gifts from retirement plans, gifts of appreciated assets, the use of private foundations, and life insurance.
Why cash is not king in fundraising: Results from 1 million nonprofit tax ret...Russell James
This research tracks the fundraising growth of hundreds of thousands of nonprofit organizations from 2010 through 2016 to identify what predicts current and long-term fundraising growth. A key predictor is whether the nonprofit effectively pursues gifts of assets (e.g., stocks, bonds, real estate) rather than gifts of cash. This presentation reviews these comprehensive results, investigates the psychological and practical aspects of why gifts of assets are so critical for high-growth fundraising, and discusses strategies for effectively pursuing these important gifts.
The hidden code behind death-related financial decisions Russell James
Understanding the hidden code behind client decisions
in life insurance, annuities, estate planning, planned giving, end-of-life medical planning, and other death-related topics
Currently pi network is not tradable on binance or any other exchange because we are still in the enclosed mainnet.
Right now the only way to sell pi coins is by trading with a verified merchant.
What is a pi merchant?
A pi merchant is someone verified by pi network team and allowed to barter pi coins for goods and services.
Since pi network is not doing any pre-sale The only way exchanges like binance/huobi or crypto whales can get pi is by buying from miners. And a merchant stands in between the exchanges and the miners.
I will leave the telegram contact of my personal pi merchant. I and my friends has traded more than 6000pi coins successfully
Tele-gram
@Pi_vendor_247
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what is the best method to sell pi coins in 2024DOT TECH
The best way to sell your pi coins safely is trading with an exchange..but since pi is not launched in any exchange, and second option is through a VERIFIED pi merchant.
Who is a pi merchant?
A pi merchant is someone who buys pi coins from miners and pioneers and resell them to Investors looking forward to hold massive amounts before mainnet launch in 2026.
I will leave the telegram contact of my personal pi merchant to trade pi coins with.
@Pi_vendor_247
when will pi network coin be available on crypto exchange.DOT TECH
There is no set date for when Pi coins will enter the market.
However, the developers are working hard to get them released as soon as possible.
Once they are available, users will be able to exchange other cryptocurrencies for Pi coins on designated exchanges.
But for now the only way to sell your pi coins is through verified pi vendor.
Here is the telegram contact of my personal pi vendor
@Pi_vendor_247
What price will pi network be listed on exchangesDOT TECH
The rate at which pi will be listed is practically unknown. But due to speculations surrounding it the predicted rate is tends to be from 30$ — 50$.
So if you are interested in selling your pi network coins at a high rate tho. Or you can't wait till the mainnet launch in 2026. You can easily trade your pi coins with a merchant.
A merchant is someone who buys pi coins from miners and resell them to Investors looking forward to hold massive quantities till mainnet launch.
I will leave the telegram contact of my personal pi vendor to trade with.
@Pi_vendor_247
what is the future of Pi Network currency.DOT TECH
The future of the Pi cryptocurrency is uncertain, and its success will depend on several factors. Pi is a relatively new cryptocurrency that aims to be user-friendly and accessible to a wide audience. Here are a few key considerations for its future:
Message: @Pi_vendor_247 on telegram if u want to sell PI COINS.
1. Mainnet Launch: As of my last knowledge update in January 2022, Pi was still in the testnet phase. Its success will depend on a successful transition to a mainnet, where actual transactions can take place.
2. User Adoption: Pi's success will be closely tied to user adoption. The more users who join the network and actively participate, the stronger the ecosystem can become.
3. Utility and Use Cases: For a cryptocurrency to thrive, it must offer utility and practical use cases. The Pi team has talked about various applications, including peer-to-peer transactions, smart contracts, and more. The development and implementation of these features will be essential.
4. Regulatory Environment: The regulatory environment for cryptocurrencies is evolving globally. How Pi navigates and complies with regulations in various jurisdictions will significantly impact its future.
5. Technology Development: The Pi network must continue to develop and improve its technology, security, and scalability to compete with established cryptocurrencies.
6. Community Engagement: The Pi community plays a critical role in its future. Engaged users can help build trust and grow the network.
7. Monetization and Sustainability: The Pi team's monetization strategy, such as fees, partnerships, or other revenue sources, will affect its long-term sustainability.
It's essential to approach Pi or any new cryptocurrency with caution and conduct due diligence. Cryptocurrency investments involve risks, and potential rewards can be uncertain. The success and future of Pi will depend on the collective efforts of its team, community, and the broader cryptocurrency market dynamics. It's advisable to stay updated on Pi's development and follow any updates from the official Pi Network website or announcements from the team.
how to sell pi coins in all Africa Countries.DOT TECH
Yes. You can sell your pi network for other cryptocurrencies like Bitcoin, usdt , Ethereum and other currencies And this is done easily with the help from a pi merchant.
What is a pi merchant ?
Since pi is not launched yet in any exchange. The only way you can sell right now is through merchants.
A verified Pi merchant is someone who buys pi network coins from miners and resell them to investors looking forward to hold massive quantities of pi coins before mainnet launch in 2026.
I will leave the telegram contact of my personal pi merchant to trade with.
@Pi_vendor_247
Empowering the Unbanked: The Vital Role of NBFCs in Promoting Financial Inclu...Vighnesh Shashtri
In India, financial inclusion remains a critical challenge, with a significant portion of the population still unbanked. Non-Banking Financial Companies (NBFCs) have emerged as key players in bridging this gap by providing financial services to those often overlooked by traditional banking institutions. This article delves into how NBFCs are fostering financial inclusion and empowering the unbanked.
USDA Loans in California: A Comprehensive Overview.pptxmarketing367770
USDA Loans in California: A Comprehensive Overview
If you're dreaming of owning a home in California's rural or suburban areas, a USDA loan might be the perfect solution. The U.S. Department of Agriculture (USDA) offers these loans to help low-to-moderate-income individuals and families achieve homeownership.
Key Features of USDA Loans:
Zero Down Payment: USDA loans require no down payment, making homeownership more accessible.
Competitive Interest Rates: These loans often come with lower interest rates compared to conventional loans.
Flexible Credit Requirements: USDA loans have more lenient credit score requirements, helping those with less-than-perfect credit.
Guaranteed Loan Program: The USDA guarantees a portion of the loan, reducing risk for lenders and expanding borrowing options.
Eligibility Criteria:
Location: The property must be located in a USDA-designated rural or suburban area. Many areas in California qualify.
Income Limits: Applicants must meet income guidelines, which vary by region and household size.
Primary Residence: The home must be used as the borrower's primary residence.
Application Process:
Find a USDA-Approved Lender: Not all lenders offer USDA loans, so it's essential to choose one approved by the USDA.
Pre-Qualification: Determine your eligibility and the amount you can borrow.
Property Search: Look for properties in eligible rural or suburban areas.
Loan Application: Submit your application, including financial and personal information.
Processing and Approval: The lender and USDA will review your application. If approved, you can proceed to closing.
USDA loans are an excellent option for those looking to buy a home in California's rural and suburban areas. With no down payment and flexible requirements, these loans make homeownership more attainable for many families. Explore your eligibility today and take the first step toward owning your dream home.
how can i use my minded pi coins I need some funds.DOT TECH
If you are interested in selling your pi coins, i have a verified pi merchant, who buys pi coins and resell them to exchanges looking forward to hold till mainnet launch.
Because the core team has announced that pi network will not be doing any pre-sale. The only way exchanges like huobi, bitmart and hotbit can get pi is by buying from miners.
Now a merchant stands in between these exchanges and the miners. As a link to make transactions smooth. Because right now in the enclosed mainnet you can't sell pi coins your self. You need the help of a merchant,
i will leave the telegram contact of my personal pi merchant below. 👇 I and my friends has traded more than 3000pi coins with him successfully.
@Pi_vendor_247
Resume
• Real GDP growth slowed down due to problems with access to electricity caused by the destruction of manoeuvrable electricity generation by Russian drones and missiles.
• Exports and imports continued growing due to better logistics through the Ukrainian sea corridor and road. Polish farmers and drivers stopped blocking borders at the end of April.
• In April, both the Tax and Customs Services over-executed the revenue plan. Moreover, the NBU transferred twice the planned profit to the budget.
• The European side approved the Ukraine Plan, which the government adopted to determine indicators for the Ukraine Facility. That approval will allow Ukraine to receive a EUR 1.9 bn loan from the EU in May. At the same time, the EU provided Ukraine with a EUR 1.5 bn loan in April, as the government fulfilled five indicators under the Ukraine Plan.
• The USA has finally approved an aid package for Ukraine, which includes USD 7.8 bn of budget support; however, the conditions and timing of the assistance are still unknown.
• As in March, annual consumer inflation amounted to 3.2% yoy in April.
• At the April monetary policy meeting, the NBU again reduced the key policy rate from 14.5% to 13.5% per annum.
• Over the past four weeks, the hryvnia exchange rate has stabilized in the UAH 39-40 per USD range.
Monthly Economic Monitoring of Ukraine No. 232, May 2024
Ponzis, Pyramids, and Bubbles: An introduction to financial fraud
1. Ponzis Pyramids and Bubbles
An introduction to financial fraud
Professor Russell James Dept. of Personal Financial Planning Texas Tech University
2. The core of any Ponzi Scheme is the HIDDEN reality that payments come from new investors, not actual profits
3. •HIDDEN reality that payments come from new investors, not actual profits
Common Features
Core
•“Plausible” story
•Above market returns
•No returns variance
•Mandatory delay for investment return
•Targets affinity group
•Less sophisticated investors
•Social credibility v. audited credibility
•Collapses when growth slows/stops
What is a Ponzi Scheme?
4. Charles Ponzi
https://www.youtube.com/watch? v=vFEMzCMyMXc
•HIDDEN reality that payments come from new investors, not actual profits
Common Features
Ponzi Core
•“Plausible” story
•Above market returns
•No returns variance
•Mandatory delay for investment return
•Targets affinity group
•Less sophisticated investors
•Social credibility v. audited credibility
•Collapses when growth slows/stops
5. Arbitrage in post office international reply coupons valued at $.06 in U.S., sold for $.01 in Spain.
•HIDDEN reality that payments come from new investors, not actual profits
Common Features
Ponzi Core
•“Plausible” story
•Above market returns
•No returns variance
•Mandatory delay for investment return
•Targets affinity group
•Less sophisticated investors
•Social credibility v. audited credibility
•Collapses when growth slows/stops
Charles Ponzi
6. 50% return in 45 days or 100% return in 90 days
•HIDDEN reality that payments come from new investors, not actual profits
Common Features
Ponzi Core
•“Plausible” story
•Above market returns
•No returns variance
•Mandatory delay for investment return
•Targets affinity group
•Less sophisticated investors
•Social credibility v. audited credibility
•Collapses when growth slows/stops
Charles Ponzi
7. Investors were recent immigrants, often of his ethnicity
•HIDDEN reality that payments come from new investors, not actual profits
Common Features
Ponzi Core
•“Plausible” story
•Above market returns
•No returns variance
•Mandatory delay for investment return
•Targets affinity group
•Less sophisticated investors
•Social credibility v. audited credibility
•Collapses when growth slows/stops
Charles Ponzi
8. “Truly, for an immigrant, I did not look the part. There was nothing in my appearance to suggest the bread winner; nothing that could even be remotely associated with the thought of manual labor, of work of any kind; of economic penury. From tie to spats, I looked like a million dollars just out of the mint; like a young gentleman of leisure, perhaps like the scion of wealthy parents on a pleasure tour. And that goes to show that appearances don't mean a thing. In fact, I was in a jam right then… Broke right from the start, my entire resources in cash amounting to $2.50.” From his autobiography (pnzi.com)
Charles Ponzi
9. •HIDDEN reality that payments come from new investors, not actual profits
Common Features
Ponzi Core
“Broke right from the start, my entire resources in cash amounting to $2.50.”
•“Plausible” story
•Above market returns
•No returns variance
•Mandatory delay for investment return
•Targets affinity group
•Less sophisticated investors
•Social credibility v. audited credibility
•Collapses when growth slows/stops
Charles Ponzi
10. Early investors were paid as promised (from new investors’ money) leading to an enormous demand from new and repeat investors.
•HIDDEN reality that payments come from new investors, not actual profits
Common Features
Ponzi Core
•“Plausible” story
•Above market returns
•No returns variance
•Mandatory delay for investment return
•Targets affinity group
•Less sophisticated investors
•Social credibility v. audited credibility
•Collapses when growth slows/stops
Charles Ponzi
11. Lasted 8 months. Took in a total of $15 million before collapse.
•HIDDEN reality that payments come from new investors, not actual profits
Common Features
Ponzi Core
•“Plausible” story
•Above market returns
•No returns variance
•Mandatory delay for investment return
•Targets affinity group
•Less sophisticated investors
•Social credibility v. audited credibility
•Collapses when growth slows/stops
Charles Ponzi
12.
13. New Era Philanthropy
•HIDDEN reality that payments come from new investors, not actual profits
Common Features
Ponzi Core
•“Plausible” story
•Above market returns
•No returns variance
•Mandatory delay for investment return
•Targets affinity group
•Less sophisticated investors
•Social credibility v. audited credibility
•Collapses when growth slows/stops
https://www.youtube.com/watch? v=dfIz9_Pw_tk
14. •HIDDEN reality that payments come from new investors, not actual profits
Common Features
Ponzi Core
•“Plausible” story
•Above market returns
•No returns variance
•Mandatory delay for investment return
•Targets affinity group
•Less sophisticated investors
•Social credibility v. audited credibility
•Collapses when growth slows/stops
Gave donors a chance to double their gifts to charity allegedly from a group of wealthy “anonymous donors.” Later, non-profits were told that their funds would be matched by the anonymous donors and returned after a three-to- nine month holding period in a “semi-escrow” Prudential Securities account
New Era Philanthropy
15. •HIDDEN reality that payments come from new investors, not actual profits
Common Features
Ponzi Core
•“Plausible” story
•Above market returns
•No returns variance
•Mandatory delay for investment return
•Targets affinity group
•Less sophisticated investors
•Social credibility v. audited credibility
•Collapses when growth slows/stops
Claimed to have six anonymous donors providing matching funds. The founder was friends with John M. Templeton, Jr., son of John Templeton, Sr., the famous investor and philanthropist. Used Prudential Securities account.
New Era Philanthropy
16. •HIDDEN reality that payments come from new investors, not actual profits
Common Features
Ponzi Core
•“Plausible” story
•Above market returns
•No returns variance
•Mandatory delay for investment return
•Targets affinity group
•Less sophisticated investors
•Social credibility v. audited credibility
•Collapses when growth slows/stops
Gift or deposit was doubled after 6 months, later 9 months.
New Era Philanthropy
17. •HIDDEN reality that payments come from new investors, not actual profits
Common Features
Ponzi Core
•“Plausible” story
•Above market returns
•No returns variance
•Mandatory delay for investment return
•Targets affinity group
•Less sophisticated investors
•Social credibility v. audited credibility
•Collapses when growth slows/stops
Founder was Philadelphia Christian businessman, started with his philanthropic Christian friends and expanded to Philadelphia area churches & non-profits (before mushrooming to national nonprofits in the last year)
New Era Philanthropy
18. •HIDDEN reality that payments come from new investors, not actual profits
Common Features
Ponzi Core
•“Plausible” story
•Above market returns
•No returns variance
•Mandatory delay for investment return
•Targets affinity group
•Less sophisticated investors?
•Social credibility v. audited credibility
•Collapses when growth slows/stops
Although beginning with friends and then local Philadelphia nonprofits, eventually expanded to including Philadelphia Public Library, University of Pennsylvania, Philadelphia Orchestra. Then mushroomed before collapse including many national charities and universities.
New Era Philanthropy
19. •HIDDEN reality that payments come from new investors, not actual profits
Common Features
Ponzi Core
•“Plausible” story
•Above market returns
•No returns variance
•Mandatory delay for investment return
•Targets affinity group
•Less sophisticated investors
•Social credibility v. audited credibility
•Collapses when growth slows/stops
Original credibility from relationships with other Philadelphia Christian businessmen. Later, credibility came from others who had invested and the plan’s longer duration 1989- 1995.
New Era Philanthropy
20. •HIDDEN reality that payments come from new investors, not actual profits
Common Features
Ponzi Core
•“Plausible” story
•Above market returns
•No returns variance
•Mandatory delay for investment return
•Targets affinity group
•Less sophisticated investors
•Social credibility v. audited credibility
•Collapses when growth slows/stops
Grew exponentially. Started with personal acquaintances in 1989 with $5,000 minimum donations, then $25,000 minimum donations. In 1994 opened to non- profit deposits. At collapse had raised $345 million.
New Era Philanthropy
21. •HIDDEN reality that payments come from new investors, not actual profits
Common Features
Ponzi Core
•“Plausible” story
•Above market returns
•No returns variance
•Mandatory delay for investment return
•Targets affinity group
•Less sophisticated investors
•Social credibility v. audited credibility
•Collapses when growth slows/stops
https://www.youtube.com/watch?v=s68FR1MXT8Q http://video.pbs.org/video/1122731028/ http://www.hulu.com/watch/59463
Bernie Madoff
22. Bernie Madoff
•HIDDEN reality that payments come from new investors, not actual profits
Common Features
Ponzi Core
•“Plausible” story
•Above market returns
•No returns variance
•Mandatory delay for investment return
•Targets affinity group
•Less sophisticated investors
•Social credibility v. audited credibility
•Collapses when growth slows/stops
“The essence of his scheme was to deposit client money into a Chase account, rather than invest it and generate steady returns as clients had believed. When clients wanted their money, "I used the money in the Chase Manhattan bank account that belonged to them or other clients to pay the requested funds," he told the court.” http://www.reuters.com/article/2010/12/02/us-madoff- jpmorgan-idUSTRE6B153220101202
23. •HIDDEN reality that payments come from new investors, not actual profits
Common Features
Ponzi Core
•“Plausible” story
•Above market returns
•No returns variance
•Mandatory delay for investment return
•Targets affinity group
•Less sophisticated investors
•Social credibility v. audited credibility
•Collapses when growth slows/stops
Fake trades were “recorded” after the fact to match indicated returns. Because he operated a trading company and was former chairman of NASDAQ, some assumed he had insider trading ability. [E.g., “front running” where stockbroker buys ahead of customer’s large buy orders then sells immediately afterwards]
Bernie Madoff
24. •HIDDEN reality that payments come from new investors, not actual profits
Common Features
Ponzi Core
•“Plausible” story
•Above market returns
•No returns variance
•Mandatory delay for investment return
•Targets affinity group
•Less sophisticated investors
•Social credibility v. audited credibility
•Collapses when growth slows/stops
Provided above market returns with essentially no variance in a hedge fund for many years. Offered only about 10.5% annual returns, but returns were always up. Harry Markopolis notes, “Only 4% of the months were down months.”
Bernie Madoff
25. •HIDDEN reality that payments come from new investors, not actual profits
Common Features
Ponzi Core
•“Plausible” story
•Above market returns
•No returns variance
•Mandatory delay for investment return
•Targets affinity group
•Less sophisticated investors
•Social credibility v. audited credibility
•Collapses when growth slows/stops
No mandatory delay. Targeted private foundations as they need only pay 5% of assets per year, thus few redemptions. Because the investment opportunity was “exclusive,” investors were wary of removing their money from his fund, in case they could not get back in later.
Bernie Madoff
26. •HIDDEN reality that payments come from new investors, not actual profits
Common Features
Ponzi Core
•“Plausible” story
•Above market returns
•No returns variance
•Mandatory delay for investment return
•Targets affinity group
•Less sophisticated investors
•Social credibility v. audited credibility
•Collapses when growth slows/stops
Started and grew with wealthy Jewish investors and nonprofits. New York Post reported that Madoff "worked the so-called 'Jewish circuit' of well- heeled Jews he met at country clubs on Long Island and in Palm Beach.“ “The major firms on wall street had no money with Madoff.” – Harry Markopolis
Bernie Madoff
28. •HIDDEN reality that payments come from new investors, not actual profits
Common Features
Ponzi Core
•“Plausible” story
•Above market returns
•No returns variance
•Mandatory delay for investment return
•Targets affinity group
•Less sophisticated investors
•Social credibility v. audited credibility
•Collapses when growth slows/stops
•Started firm in 1960
•Former chairman of NASDAQ
•Financial inquiry foregone by some investors perhaps because presumption of insider trading (front running) to create profits
Bernie Madoff
29. •HIDDEN reality that payments come from new investors, not actual profits
Common Features
Ponzi Core
•“Plausible” story
•Above market returns
•No returns variance
•Mandatory delay for investment return
•Targets affinity group
•Less sophisticated investors
•Social credibility v. audited credibility
•Collapses when growth slows/stops
Because of his low return rates (app. 10.5%) the collapse could have come more slowly (after his death). But, the financial crisis caused a massive run of redemptions.
Bernie Madoff
30. How is a pyramid scheme different from a Ponzi scheme?
31. Each passenger pays $5,000 to the captain to join the pyramid. Once a 8 passengers have paid ($40,000), the captain is retired, the co-pilots become captains, etc. The goal is to become a captain. The pyramid can become a scam when the promoter fills in the top three levels with phony names (all paying him).
Example Pyramid Scheme (not “Ponzi”)
32. Pyramid Scheme
•REVEALED reality that payments come from new investors, not actual profits
•True story
•Unknown returns
•Much variance
•Unknown delay
•Maybe
•Yes
•Maybe
•Slows/stops instead of collapse
•HIDDEN reality that payments come from new investors, not actual profits
Common Features
Ponzi
•“Plausible” story
•Above market returns
•No returns variance
•Mandatory delay for investment return
•Targets affinity group
•Less sophisticated investors
•Social credibility v. audited credibility
•Collapses when growth slows/stops
33. How is a market “bubble” different from a Ponzi scheme?
34. Housing price-to-rent (price-to-income) ratios
Andre, C., Gil-Alana, L., Gupta, R. (2014). Testing for persistence in housing price-to-income and price-to-rent ratios in 16 OECD countries. Applied Economics, 46 (18), 2127-2138
35. S&P 500 historical price-to-earnings ratio To December, 2014
From http://www.multpl.com/
36. Bubble
•REVEALED reality that growth comes from new investors, not actual profits
•Yes
•Yes
•High variance
•No
•No
•No
•No
•Must collapse IF supply is unlimited
•HIDDEN reality that payments come from new investors, not actual profits
Common Features
Ponzi
•“Plausible” story
•Above market returns
•No returns variance
•Mandatory delay for investment return
•Targets affinity group
•Less sophisticated investors
•Social credibility v. audited credibility
•Collapses when growth slows/stops
38. Why me? Why do they need MY money? If this investment is so great, wouldn’t it be easier to get more money in larger chunks from sophisticated institutional investors? If the investment is so great, why does it require paying this promoter to sell it to me? Great investments don’t come looking for you.
39. Beware of investments that look “too good”
High return, low variance investment results are a statistical red flag for fraud. Bollen, N. & Pool, V. (2012) Suspicious patterns in hedge fund returns and the risk of fraud. Review of Financial Studies, 25 (9), 2673-2702
40. Question it Get outside advice. Verify with outsiders (not affinity group members) such as state securities regulators, SEC, technical professionals in the field. Pay for quality advice. Start by Googling it. Don’t be rushed. Show me the audit. Review CPA audited financial statements. Is this a large CPA firm? Why not? Can the assets actually be sold for their stated value? Remember, profit is opinion – cash is reality.
Watch the reaction to hard questions. Defensiveness? Socially inappropriate? Threatened with being left out?
41. Year of Discovery
Name/Alleged Investment
Amount
2014
Nationwide Automated Systems; ATMs
$123MM
2014
KGTA Petroleum; Reselling crude and other oil products
$20MM
2013
Yost Development - Tunisia
$40MM
2012
Zeekler penny auction website
$600MM
2012
Contract emu farming
$28MM
2012
Gold - Genneva Malaysia Sdn Bhd
$330MM
2012
Bitcoin Savings and Trust (BTCST)
$250MM
2011
Risher “private equity funds”
$21MM
2010
Justin Laurin Prather – Lubbock, TX; bridge loans for golf carts
$12.5MM
2010
Sale of promissory notes – World Financial Group
$14.8MM
2010
Oxford Group - Minnesota
$194MM
2009
Benny Judah– Lubbock, TX
$59MM
2009
Green energy investments (Mantria Corp)
$30MM
Not So Rare: Example Reported Ponzi Schemes