What is Ponzi schemes ?

Defination:
  • It is a kind of fraud scheme which use Network marketing as a tool. 
  • Investors are paid out of  new investments. 
  • The scheme is a fraudulent investment operation where the operator, an individual or organization, pays returns to its investors from new capital paid to the operators by new investors,rather than from profit earned by the operator.
  • These schemes end when new investments stop coming and large number of investors wants to withdraw their money. 
  • Latest Ponzi scheme in India was "Speak Asia".