Pushing the Ponzi: The Rise and Fall of a Network Fraud
In 1920, Charles Ponzi was the talk of Boston. His business, The Security Exchange Company, was taking in more than $1 million a week from investors. He had guaranteed them an astonishing rate of return-50% interest on their principal in 45 days. The wealth was generated through an international reply postal coupon, a device for facilitating international business. Ponzi told his investors that he could buy a postal coupon in Spain for one cent and cash it in America for six one-cent stamps. It was all legal and lauded by many as a brilliant plan.