The concept of the Ponzi scheme did not end in 1920. As technology changed, so did the Ponzi scheme. In 2008, Bernard Madoff was convicted of running a Ponzi scheme that falsified trading reports to show a client was earning a profit. Now in the CryptoCurency we had BitConnect just 2 days ago turning out to be one.
Regardless of the technology used in the Ponzi scheme, most share similar characteristics:
1. A guaranteed promise of high returns with little risk
2. Consistent flow of returns regardless of market conditions
3. Investments that have not been registered with the Securities and Exchange Commission (SEC)
4. Investment strategies that are a secret or described as too complex
5. Clients not allowed to view official paperwork for their investment
6. Clients facing difficulties removing their money
Hope that the characteristics will guide/help you in you next investments.
