American Greed is a great television show that appears almost every night on CNBC. It is a crime show telling stories about con artists from Bernie Maddoff down to small cons stealing a few hundred thousand dollars. Some cases involve embezzlement of funds or just straight defrauding people out of their money.
The majority of the cases concern Ponzi schemes. In this type of crime a smooth-talking and clever man or woman approaches investors. There is an offer of very high and guaranteed returns. This fraudulent person presents himself or herself as a master investor with exceptional skills. At first only a few people invest and get great payments each month. Then"word of mouth advertising" kicks in. Soon hundreds r thousands of people are investing to get the magical returns. The fraudulent person collects millions or billions of dollars.
The con person getting all of this money lets it go to their heads. They go out and buy luxury homes, corporate jets, luxury cars, diamonds, etc. Often they run up large gambling losses in some place like Las Vegas. They either invest none of the money collected or they make ill-advised investment decisions that end up in huge losses for them.
This scheme can go on for years or decades as long as new investors are constantly brought in to keep the payments flowing to the older investors. Clients get fancy statements each month showing their investments having fabulous results.
One day there is an economic crisis like 2008-2009 or some investor gets very suspicious. The scheme collapses. The con person is arrested by some law enforcement agency like the Secret Service, FBI, NYPD, etc. All of this persons luxury items are seized and sold. They end up with prison sentences ranging from 12 years to 150 years.
I have watched this show with great fascination for months. Only one con person was able to escape arrest and "live happily ever after" with their ill-gotten gain. His name is Eric Bartoli.. His story is in the link below:
It is tragic that investors lose literally billions of dollars with schemes like this. There are so many ethical and reputable investment advisers around. Why do so many gullible people get "suckered" by these fraud artists?
It is equally sad that literally thousands of well-run and worthy businesses cannot find the finance that they need for real success.
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