How Many Ponzi Schemes Are There?

How Many Ponzi Schemes Are There?

 I am often asked, "How many Ponzi schemes are there?" This is a tough question to answer with 100% accuracy because there is no central registry for all Ponzi scheme cases. The media certainly reports on the big cases, and occasionally the smaller, local cases, but most schemes go unreported as lawyers, accountants, trustees and receivers quietly unravel them.

The Securities Exchange Commission does respond to a significant portion of Ponzi scheme cases - the ones that involve the fraudulent sale of securities. Its website reports that since fiscal year 2010, it has brought more than 100 enforcement actions against nearly 200 individuals and 250 entities for carrying out Ponzi schemes.

The website of the Commodity Futures Trading Commission also has an extensive list of the enforcement actions that it has taken in cases involving Ponzi schemes and other frauds. So far in 2013, it has published 47 press releases regarding its new and pending enforcement actions. Click here. (http://www.cftc.gov/PressRoom/PressReleases/EnforcementPressReleases/index.htm)

Monthly, this blog summarizes the stories relating to Ponzi schemes that make the news around the globe. The reported stories include newly discovered Ponzi schemes, guilty pleas and convictions relating to previously discovered schemes, and the sentences that courts dole out to the perpetrators. Those reported stories reflect these statistics for just the first four months of 2013:

  • Over 42 people pleaded guilty or were found guilty of charges relating to Ponzi schemes involving over $1.925 billion. In addition at least 3 other individuals were charged but pleaded not guilty to charges relating to Ponzi schemes involving over $87 million.
  • Over 30 people were sentenced in connection with Ponzi schemes involving over $775 million.
  • New charges were brought in connection with newly discovered Ponzi schemes involving more than $4.35 billion.
  • Over the past year alone, millions of investors have been defrauded by Ponzi schemes.

These are staggering statistics, with no end in sight.  Anyone have any good ideas on how to stop this onslaught?

Read additional articles at The Ponzi Scheme Blog

Kathy Bazoian Phelps is the co-author of The Ponzi Book: A Legal Resource for Unraveling Ponzi Schemes  (LexisNexis 2012), along with Hon. Steven Rhodes.  The Ponzi Book, recently reviewed by the ABI Journal and Commercial Crime International, is available for purchase at www.lexisnexis.com/ponzibook, and more information about the book can be found at www.theponzibook.com

Watch Kathy's interview on the The Not So Legal Show.

For more information about LexisNexis products and solutions connect with us through our corporate site.