People throughout Florida have likely heard about Ponzi schemes on news broadcasts over the last several years. Several high-profile criminal cases involving Ponzi schemes have made national headlines. This type of white-collar crime is deceptively simple and is designed to steal large sums of money from unsuspecting investors.
At its core, a Ponzi scheme is a type of investment fraud. In a typical Ponzi case, a person who may or may not be a financial professional will approach new potential investors with the promise of an investment that offers big payouts with a very small or nonexistent chance that invested money will be lost. However, instead of using investors' funds in the promised fashion, the fraudster will instead use funds from each new investor to pay "dividends" to the original investors. Of course, there are no actual payouts because no money was ever actually invested.