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What is a Ponzi scheme?

by | Nov 14, 2015 | Fraud Law

A Ponzi scheme is a type of white collar crime that is easily misunderstood and learning the truth about these accusations is important for anyone facing them.

People in Dallas may have heard of Ponzi schemes before but do not fully understand these charges. Learning about them can be important for a person as a way to stay protected in the event that charges of a white collar crime should ever be faced. Business and reputation damage can result as well as criminal consequences depending upon the situation.

Facts about Ponzi schemes

The U.S. Securities and Exchange Commission indicates that situations in which investments are solicited and extremely high returns are promised can be considered a type of fraud known as Ponzi scheme. Headlines from various sources give examples of some recent cases in which these allegations have been made:

  • A reports tells of 20 counts of criminal charges that were dropped in one Ponzi scheme case after the defendant, a day trader, entered a guilty plea in court for an additional five criminal counts. According to the report, it was anticipated that she would face a prison sentence of 10 years.
  • Two people have pled guilty to an alleged Ponzi scheme in Maryland involving a physician according to The case involved the physician’s family trust. He and his son also face criminal charges relating to tax fraud as well as allegations surrounding the Ponzi scheme.
  • On, a report was made providing details of charges of conspiracy and wire fraud made against the producer of a music festival. The allegations suggest that investors were defrauded in a mining scheme overseas.
  • A man who was previously a vice president at a bank was the subject of a report by CBS Miami. He was charged with wire fraud and conspiracy for a Ponzi scheme valued at roughly $1.2 billion. At the time of the report, he had recently been released from custody on a bail of $250,000.
  • A coach at the University of Georgia facing charges of money laundering as well as wire and mail fraud in a Ponzi scheme was found not guilty of the charges according to the Savannah Morning News.

These are just some examples of the range of situations in which Ponzi scheme crimes can be alleged.

Defendants deserve help

As with any criminal charge, allegations of white collar crime are not always true. Defendants deserve the right to fair legal representation and the ability to clear themselves appropriately. Contacting an attorney with the right experience is recommended to anyone in Dallas facing these serious charges.