In the last six and half years the Securities and Exchange Commission has reached settlements with over 300 defendants in cases related to alleged Ponzi schemes. NERA Consulting has been tracking these SEC settlements since the Sarbanes-Oxley Act was enacted in July 2002. In that time frame there have been 12 Ponzi scheme settlements that [...]
Tag Archives | Ponzi schemes
You’re a Victim of a Ponzi Scheme, But What About Your Taxes?
You missed the warning signs and got suckered into a Ponzi scheme. Can the IRS help by giving you some tax relief? This is a critical issue for long-term Ponzi scheme investors (like some of the Madoff victims) who have paid taxes on gains from the investment. After all, they have been paying real taxes [...]
Can You Prevent Ponzi Schemes?
With Madoff, Nadel and Stanford in the news, people are wondering why the government does not prevent Ponzi schemes. The government should protect us from these frauds. How can they? Ponzi scheme sponsors are thieves. Common criminals. They just wear suits instead of black masks. The government has not been able to prevent bank robberies, [...]
Irrational Exuberance
In an essay in the Wall Street Journal, Stephen Greenspan explains some of the psychology behind the success of Ponzi schemes: Why We Keep Falling For Financial Scams. The basic mechanism explaining the success of Ponzi schemes is the tendency of humans to model their actions — especially when dealing with matters they don’t fully [...]
Gullibility
NPR’s Science Friday has an interesting broadcast on Gullibility. Ira Flatow interview Stephen Greenspan, author of Annals of Gullibility: Why We Get Duped and How to Avoid It. Can science explain why some swindles are so successful? Why are some people more likely to try to buy the Brooklyn Bridge or send money to the [...]
Professor Frankel Testifies In Congress
Boston University School of Law professor Tamar Frankel testified before the Committee on Financial Services of the U.S. House of Representatives discussing Ponzi schemes, the importance of trust in the securities markets and the need for regulatory reform in light of the Madoff scandal. See also: Testimony from House.gov Testimony from JD Supra
