Ponzi Scheme
Contact us. All evaluations are free
Attorneys for Ponzi scheme losses
Investor rights lawyers Alan Rosca and Paul Scarlato have represented thousands investors who have lost money in Ponzi schemes. Investor rights lawyer Alan Rosca, one of the firm’s partners, has represented thousands of victims of Ponzi schemes.
What is a Ponzi scheme?
Ponzi schemes are investment programs in which unscrupulous promoters pay supposed returns to existing investors with money raised from new investors, in effect “robbing Peter to pay Paul.” Down cycles in financial markets often reveal Ponzi schemes when investors calling for withdrawal quickly consume the remaining funds.
Ponzi schemes are by definition unsustainable and fraudulent.
Why is a Ponzi scheme unsustainable?
Ponzi schemes are unsustainable because they depend on the promoters’ ability to continuously recruit new investors to be able to pay returns to existing investors. As the size of the scheme grows, the distribution payments to existing investors grow even larger, and at some point the promoters become unable to recruit sufficient investors to cover those distribution payments. At that point, the Ponzi scheme runs out of steam and collapses.
Why is a Ponzi scheme fraudulent?
Ponzi schemes are inherently fraudulent because new investors are not told that their money would be misused, and instead of being invested as promised it would be misdirected to pay returns to existing investors.
Do Ponzi schemes result in losses?
Ponzi schemes are an incredibly dangerous form of investment as they are inherently ill-fated to fail. Furthermore, the longer they last, the greater the number of victims which are accrued and hence the more harm and injury they can cause.
Why at the beginning everyting seemed safe and clean?
Ponzi schemes are sometimes given a patina of legitimacy as the perpetrator or promoters are associated with otherwise reputable brokerage firms, insurance companies, or accounting or law firms which fail to properly supervise their agents.
Also, Ponzi scammers often engage in “affinity fraud,” meaning they tend to defraud people who belong to the same group – ethnic groups, religious groups, professional groups, etc.
What should I do if I’m involved in a Ponzi scheme?
If you believe you may have lost your investment in a Ponzi scheme, contact us for a free, no-obligation consultation regarding your legal situation and potential recovery options, by phone at 888-998-0530 or through the contact form on this page.
If you believe you lost money as a result of investment-related fraud or misconduct, please contact our law firm for a free, no-obligation evaluation of your recovery options.
Contact us at 888‑998‑0530 or through the contact form on this page.
No recovery, no fees.*
Investor Alerts
RELATED TO
PONZI SCHEME