Tuesday 21st July 2009
The UK authorities have uncovered a Â£80 million Ponzi scheme which has caught out up to 600 people including famous personalities from the world of TV and sport. Made famous by the Bernard Madoff affair in the US, Ponzi schemes are effectively operations which use income from new investors to pay interest and income to existing investors. The schemes can often go unnoticed for many years until the trail of new investors goes cold and the schemes effectively collapse.
The City of London police fraud squad took the unusual step of staging a number of seminars this week during which the victims were able to ask questions and obtain details of how the fund in question operated. However, such was the professionalism associated with this particular high yield fund that many victims still do not understand or believe they have been duped. Indeed a number of attendees at the meetings actually blamed the police for closing down the fund and ultimately causing the collapse.
Unfortunately this particular discovery is part of an ongoing increase in fraudulent activity around the world with more people becoming more desperate. While the vast majority of details associated with this particular scheme have yet to be released into the public domain we await further information with anticipation.