What is a ponzi scheme, How do the operators of a Ponzi

What is a ponzi scheme

Reference no: EM131304286

According to an article in the Wall Street Journal: The U.S. Securities and Exchange Commission on Wednesday filed charges against the investment company GTF Enterprises Inc. . . . The SEC complaint alleges that Gedrey Thompson and GTF conducted an offering fraud and Ponzi scheme to unsophisticated investors. Thompson and his associates "conned at least 20 investors into investing over $800,000 in GTF by promising lofty, but false, investment returns with guaranteed safety of principal, among other things," the SEC complaint said.

a. What is a Ponzi scheme?

b. How do the operators of a Ponzi scheme manage to keep it going? Are investors to blame for believing they can get rich quickly as this article indicates?

Reference no: EM131304286

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