What is ponzi scheme? Ponzi schemes are a type of illegal pyramid scheme named after the notorious CHarles Ponzi, an Italy immigrant who duped thousands of New England residents into investing in a postage stamp speculation scheme back in the 1920s.
The principe is simple, the Ponzi scheme works on the "rob-Peter-to-pay-Paul" principle, as money from new investors is used to pay off earlier investors until the whole scheme collapses.
excerpt from
US Securiteis and Exchange Commision.
Last year in one of my entry, I wrote about the Autosurf scheme namely 12 Daily Pro. In March 2006, the SEC of America has ordered the 12 Daily Pro to stop their operations. Remember the story between Stormpay and 12Daily Pro, where the Stormpay froze the fund from 12DailyPro, claiming that the scheme was similar as the Ponzi Scheme.
U.S. SECURITIES AND EXCHANGE COMMISSION
Litigation Release No. 19592 / March 7, 2006
Securities And Exchange Commission v. Charis Johnson, LifeClicks, LLC, and 12daily Pro, Civil Action No. CV 06-01018 NM (PLAx) (C.D. Cal.)
Court Enters Order Permanently Enjoining and Freezing Assets of Defendants in 12daily Pro "Autosurf" Internet Ponzi Scheme, and Appointing Permanent Receiver
The Honorable Nora M. Manella, United States District Judge for the Central District of California, today entered an order permanently enjoining defendants Charis Johnson, LifeClicks, LLC, and 12daily Pro from violating the antifraud and securities registration provisions of the federal securities laws. In addition to the permanent injunctions, the order freezes the defendants' assets, appoints a permanent receiver over LifeClicks and 12daily Pro, prohibits the destruction of documents by the defendants, and requires accountings from the defendants. The defendants consented to the entry of the order without admitting or denying the allegations in the complaint. Read more
But who knows, that the Stormpay might be a scammers to. They cooperate each other, created the story between them so the investors feel like the 12Daily Pro was right and the Stormpay was on the wrong side.
After all there are no lunch you can get it for free......
Read more about PONZI Scheme
- Wiki Ponzi
- Ponzi at Technorati