Citation Needed - Charles Ponzi

Episode Date: January 31, 2018

Charles Ponzi, (born Carlo Pietro Giovanni Guglielmo Tebaldo Ponzi; March 3, 1882 – January 18, 1949), was an Italian swindler and con artist in the U.S. and Canada. His aliases include Charles Ponci, Carlo, and Charles P. Bianchi.[1] Born and raised in Italy, he became known in the early 1920s as a swindler in North America for his money-making scheme. He promised clients a 50% profit within 45 days, or 100% profit within 90 days, by buying discounted postal reply coupons in other countries and redeeming them at face value in the United States as a form of arbitrage.[2][3] In reality, Ponzi was paying earlier investors using the investments of later investors. While this type of fraudlent investment scheme was not originally invented by Ponzi, it became so identified with him that it now is referred to as a Ponzi scheme. His scheme ran for over a year before it collapsed, costing his "investors" $20 million.

And when Fat Amy swung on the rope. Oh, the best. So much fun. We have to see it again. Absolutely. Absolutely. Yeah, if we want to get the nuance, we need to see it again. Absolutely.

And then you sign up to people and you're already making money. Wow. Already make money. This is making so much sense to me right now. Hey guys, what's going on? Guys, you got to get in on this. So now that we learn that the dialup actually doesn't know who we are,

Tom has this amazing new system of sales where you make money off of other people's sales. Wait, wait, does no one get the credit for signing up? I want to tell him about it. You see, no, I do. I'm so excited. I'm so excited. That's the beauty.

We all get credit. And we all get a percentage of E line he sales after their initial buy-in period. All right. Wait, is this like a pyramid scheme? So pretty. And that's so stupid. Like this is multi level marketing, nothing like a Ponzi scheme. Okay. Even I know that that's just a different word for Ponzi scheme. And wear Velcro shoes. Wait, are you guys telling me that this business venture is like the subject of today's episode? Oh man.

Yeah, Lucinda, tell your brother I don't have anything to talk to him about. I can't believe this. Hold on a second, guys. Well, let's, come on. Guys. So, Tom, is your day job really a Ponzi scheme? I mean The company in America so you know, yeah got it A ladies and gentlemen, let's get ready to ramble!

That's right! It's time for citation needed. The podcast where we choose a subject read a single article about it on Wikipedia and pretend we're experts because this is the internet and that's how it works now. I'm no illusions and I'll be the scruffy nerve her leading this attack on the Death Star

which only really makes sense if I'm playing that land of Calrissian was also a scruffy nerve herder since hand ever let an attack on the Death Star but whatever I'll read the line, what I'm not gonna do it alone. Ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha going to see a face that's on. I'm just so glad I don't know what Jedi drunk dial means like a like no one knows that means should ever take their shirt off. Actually, because no one knows what that means ever has a reason to take their shirt off. These are not the androids you're looking.

You can shower around and under guys. Come on. Also joining us tonight, two guys who can't stop telling you how they used a bullseye Wamprats back home, Cecil and he guys never bullseye any Wamprats without their consent. That's like rule number one. Yeah. But if you do, you want to keep a check for like 130 grand, right? Also some penicillin because you have the clap now.

I don't go like that with money well, but I'm just saying like that's like that's hush money that we now all know about. No, no hush involved. Do you think that like fucking the porn star was going to take him down like the pussy grabbing didn't like when the pussy grabbing didn't think. No, didn't take him down the his first thought must have been fuck I wasted that 130 grand Now before we make the jump to light speed here We'd like to thank the heroic patron army that funds this show without you this role

Based wouldn't have anywhere near as many blinky lights and shit And if you'd like to learn how to enlist be sure to stick around till the end of the show and with that out of the way Tell us heath what person plays think concept phenomenon or event will be talking about today? All right. Well, thanks to patron Michael Hughes, we'd be talking about the father of Medicare Charles Ponzi. That's not, you don't really pay what I just said.

That's the city. Yeah, right. It was just you can fucking change it. It turns out all you gotta do is put it back space. It's not that amazing. All right, Cecil, you read this article, or at least convince somebody to convince somebody to convince somebody to read it before you start.

Are you ready to, uh, sure, uh, stop this pyramid? I'm hired pack animals and I've hired other pack animals, so I'm ready to go here. So sorry. All right, there we go. All right. So given your opening line in the notes,

the only sensible question I can really ask is, uh, now what are we talking about again? All right. So this is the story of Charles Ponzi, or as his friends call them, Carlo Pietro Giovanni Goliermo D'Alabaldo Ponzi. All right. It's child abuse, hyphenated names, and parents who hate each other.

That's how you end up on this show. That name is child abuse. Yeah, this guy learned his name and was like, mm, okay, okay. I think I'll fuck the world so hard they'll name this kind of fucking the world after me. Okay, seven names, sure. And you get a little and you get a little and you get a little and you get a little.

I know, I hear that I have a new life goal. Let's have a new kind of fucking name back. So Charles Budsie is the kind of immigrant that Donald Trump keeps warning us about. That's weird. His name didn't sound much. Yeah. Well, he's Italian. So he's like, you're up's Mexican. All right. So where does

the story start? Charles Bond. He was born in 1882 and grew up in Italy. And he started his working life as a postal worker. His friends were all more wealthy than he was. So when they went off to college and Rome, so did he? Well, he did stay in Rome for four years. He didn't graduate. And after all his friends left Rome, he was broke and he had no prospects. Okay. Well, I gotta be honest, that sounds great. I wish I had no prospects and was broke after college. Instead, I had no prospects and way less money than broke. Yeah. But think about how prepared for this our education. No, good point. Good point. Let's hear that pigeon again, buddy.

Wow, wow. What did we say? We didn't say that was a good one. So a lot of his friends were traveling to America and returning wealthy. The article doesn't make the connection that they sounded like they were wealthy before. Yeah, right. In any case, Ponzi's family suggested he do the same thing and help return his down on their luck family to their former glory. I love that. No pressure. Oh, hey, if you would, be a deer and win the lottery tomorrow too. Right. Thanks. Right. No, Charlie. It's not that we want the entire Atlantic Ocean between you and us. We just think it'll be good for you financially.

For every time we've all heard that, right? Right. Are you a family? So he heads to the United States and he gambles all his money away on the ride over. So there he is on the East Coast and he doesn't speak the language and he's looking to take some real Americans jobs. And so he starts working as a dishwasher and he sleeps on the floor of the restaurant. He works his way up to waiter after learning English and then he gets fired for short

changing customers and stealing. He's just convincing people to show up with food and give it to him first before they start what he then serves to the people who already sat down. And then he sells the poop for the kitchen, tonight, the next door restaurant, the whole day. Okay, wait, wait, wait, wait, just to summarize, though, it sounds like he's assimilating into American culture just in one, actually. Also, that's sure.

Also, it sounds like the odds of this episode is going to get a presidential refuite, which is what way up. So, yes. So Ponzi heads to Montreal. At this point, he's fluent in French too. He becomes a banker at a bank for Italian immigrants. The owner of this bank is offering 6% interest on deposits, which is way more than other banks. But his investments aren't making that kind of money. And he's using the new influx of deposits to pay the interest on old deposits. The owner of the bank eventually high tales it out of Canada to Mexico and takes with him

a significant amount of the bank's money. See now, and there's the problem. If he just waited a little bit longer, it would have worked out. What he should have done is just given tax cuts to the largest depositors and that way they could share it with the smaller depositors and they would all just fix itself at the end. I drove them so. Original NAFTA right there. Ponzi is positively inspired by this. So he decides to head back to the United States to make his fortune.

He's broke though. So he goes to one of the bank's customers, Canadian warehousing, and no one's there. So he writes a check to himself out of the bank's customers, Canadian warehousing, and no one's there. So he writes a check to himself out of the checkbook. Write a check for $423.58 and forges the signature of the company's director. All right, he clearly spent a weird amount of time on that number, exactly. Hi, I'd like to cash this check

for the real amount of $423.58 normal round. How about a $400 and the $56 in a $78? No, damn it. Charlie. 425.50. Stupid. Get your fake number. Get it together. So he gets questioned by the police shortly after cash in the check and immediately folds like a cheap fucking cartet. Push the insurance list. He says, I'm guilty. They put him in jail for three years and during that time he doesn't want to tell his mom that he's in prison.

So he sends her letters and he says his job is the special assistant to the prison war. Oh, Jesus. Fantastic. Dear mom, doing great in America. I'm really into crayons now. So about the cum stand. That was me, not somebody else, not somebody else. Talk to you soon. Love Charles. I don't know why I have to say that impressively hardened criminal, but I mean, I have no prison showers could change that. All right. So that's how long it took him to fuck this up. I bet he doesn't make that kind of mistake again anytime soon, huh?

Well, in 1911, he's released and he heads to America to help smuggle in other Italian immigrants across the border. And he's caught and he spent time in Atlanta prison. Wait, wait, wait, wait, smuggle him across the border, like between Italy and America, that's the best. That's the best. Come on, guys. Water's fine.

So after his release, he heads back to Boston and he starts working in a mining camp as a nurse. He hears about another nurse who suffered some burns on her body without, and without actually knowing this person, Ponzi, donates 220 inches of his skin on his back and legs. He had complications resulting from the operation and got pluric. And he also got fired for taking off the taking off time to heal, I guess. It's the best attempt at fucking a nurse ever. I brought you some skin.

You on my skin goes to her house like love actually, but instead of the note cards, he's peeling rectangles of skin off his back. Just, just, just working. I just love that the one time this guy did something good, he also got fucked. Like he's just sitting there in the hospital bed with a pink slip covered in bandages, just like, okay, that's enough of that.

Back to the fucking world, so hard they name it after me, but I got it. Uh-huh. Before that, he's just like, oh, she has got to love this homemade card I got her from my own skin. That won't be creepy. You know, guys, is this creepy? You feel like this little creepy. All right.

So it sounds like he turned over a new leaf. We choose the straight and narrow from this point in. No, I would like for a minute. When he was looking for work, he met a girl named Rose Gneko, Neko, I don't know. He proposed to her and they were married in 1918. He has an idea at this point to sell advertising and a business listing to companies.

And he goes into business trying to sell this idea and then promptly goes out of business because it's a fucking stupid idea. I was literally meet a girl and then he proposes to her but she's not the girl that he just gave 220 inches of his skin to because I feel like that it always be like a little weird like, hey honey, I bought you flowers. Oh flowers. That's nice.

Is the card written in your skin? No. Oh, just flowers. I see where I rate. How do you live up to that one? So is, is Wise family had a small fruit stand that he took over and shortly after that failed to? Fruit stand.

Yeah. Wow, you got to be trying to fuck that up. Okay. So we have a guy who basically failed as always money in the bananas. Yeah. Yeah. All right, so basically we've got a guy who's filed that everything that he did so far, sounds pretty qualified for the presidency, but when does he finally get around to succeed it?

Well, after the break, I'm going to tell you about the time he successfully got a scheme named after him. Well, that's a success. Hey podcast listener, tired of unexpected fees, service outages, and confusing, sensorious policies on your local funding platform, why not try panzion.com. Panzion.com is a great way to support the creators you love while making money doing it. That's right, you can make money for you and the creators you love from the comfort of your very own home. After setting up your initial pledge, you'll be given access to our special members only

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This idea would absolutely work if we weren't joking. And we're back when we last left our hero, Charles Ponzi was a thief, but he had yet to achieve thieving greatness. His fraudulanship had not yet come in. In 1919, he set up an office in Boston, basically coming up with ideas and trying to sell them. Oh, okay, so he invented 3M. Yeah, cool. It's him.

It's him. 3M, we don't have stuff you can buy, but we advertise anyway. Why? Get it. So at one point, a company in Spain sent him a message asking him to send his advertising catalog to them. In the envelope, there were these international reply coupons or IRCs.

These coupons were how he thought he was going to make the big bucks. Wait, so he sent a letter to the Prince of Nigeria about a huge stamp collector. He needed to unlock and that was it. Yeah. I said, you know, where you can stand? Why you would think you would make money there? The IRC is basically these little postage payment tickets that allowed the person sending something to another country to pay for the postage for the reply.

They would be bought in one country and then exchanged in another for the postage there. But if there was a discrepancy in the price that they paid for it, then the IRC could potentially be worth more in another country. In Italy, the cost of shipping was much lower than in the United States. So he thought he could make a killing on these. He started telling everyone he can make 400% profit on these coupons for stamps. He's just taping stamps all over a bag lady and sending her to Michigan to turn nickel cans into dimes like.

Garbage is the word for that actually garbage. What are you like Bernie Sanders financing your campaign? Now now he that sounds far more realistic than a Jewish president. Don't be silly. There's a lady, there's cans. Would he have to explain to somebody like how he was going to make this money, and then like if that made sense, whatever, just go, oh yeah, great idea. Thanks.

What is he rolling this dress up? That's exactly like. Well, they needed somebody to fraud them. Okay. Yeah. Okay, you got it. Okay, middle man. That's a middle man. So he tried to get a loan from the Hanover Trust Company and they just said no.

So he tried to set up a stock company and said he could get double people's money in 90 days. At this point, people were getting 5% interest on deposit. So it sounded amazing. And in his first month, he had 18 investors in $1,800. That's $54,900 in today's money. Oh, sure. That you know that. Okay. So wait, so this guy basically goes to the bank and he says, you don't understand. These women are just looking for hot dates in my area, which

like that. Just I love the idea of the look on the dude's face of the bank. Go on. Are you fucking kidding me? But that doesn't work. And then he realized that most Americans are dumber than banks. We true should have seen solar roads coming. I guess. So all the way back to so what's the what's the next step for him? So he goes out, he gets new investors.

And then he paid last month's investors with this month's deposits. He set up a larger office as people started spreading the word of this black magic fuckery that he's doing. And in February and March of 1922, months after he started, he went from $5,000 per month to $25,000 per month in the rest. What did people think he was investing in that would move like like Bitcoin like Heath please do not compare Bitcoin to a Ponzi scheme

Ponzi schemes give you paper Bitcoin is the money the future you guys it's Bitcoin tulips Bitcoin is the money in the future, you guys. It's Bitcoin tulips stock from late 90s tech startups. Have you guys, excuse me, I'm going to say, all my money and it's something like safe, you know, like real estate. Yeah. I never lose money there. Okay.

So he found a way to sell Americans and unlikely promise to get rich quick by having less money right now. I'm guessing business was booming. He is totally kidding with this point. He hired a bunch of salesmen to help get investments and they had it out to other parts of the East Coast to drum up business. In May of that same year, he made $420,000

and buy June, $2.5 million. In July, he's making a million dollars a week. What the fuck, what the fuck, what the fuck, what the fuck, $2.5 million in July is making a million dollars a week. The fuck what? It's a whole lot of it. It's fucking 19. 19. If I'm making millions of dollars a week and I'm doing it by stealing shit, I'm going to work like two weeks, then they're going to be by old boss down in Mexico for drinks.

Yeah. Right. Yeah, that's about $23 million in today's money. Jesus. Oh, I got to go to work tomorrow. I'm low on. Well, not money. I don't want to make a lot of money.

It's even worse than that because at this point, people are going nuts. They're mortgaging their homes and investing with them. They're, and they're taking their profits and they're reinvesting. Oh, my God. Ponzi took some of this money and deposited it in the handover bank and he also bought a controlling interest in that bank. And then he bought Moody's and bought standard. What do you fail though?

I feel like you forgot to buy the GOP. That's how you do that. You have to also buy the GOP. Okay. But I'm still at a loss as to why anyone buys with the GOP as selling. So, well, souls are valuable to a lot of people. So at this point, most of Ponzi's investors were immigrants, but soon the Boston elite were knocking on his door with bushels full of money to heap on him.

75% of the Boston police force also invested. He had paper boys investing investing rich bankers, even his closest associates and employees. The article says, quote, summarily, he was quite literally willing to take any scent he could get his hands on. Like Matt Lauer. I like to hunt fun this guy. Like if you're going to steal, steal from the cops, I like, how can that be fine? So even though he was paying out money to people who had joined and wanted to pull out, hadn't figured out a way to turn the international postage coupons into cash in the other country. Also logistically, it was a nightmare. Ponzi would have had to fill a Titanic-sized ship with all these coupons and ship them to

the states based on how much money was taken in. And people weren't cashing out anyway, they kept reinvesting them. But why is he still focused on the stamp coupons at this point? Yeah, right. It's taking a matter. He's running a multi-million dollar scam. And he's like, okay, well, if these have a cash value of a hundredth of a penny, he says right here on the back.

Anyone need a vote? Hey, hey, hey, hey, come on, he was waiting for double coupons Tuesday. This one worked out on double coupons Tuesday. Well, yeah, I mean, all jokes aside though, that leaves the very real question. Like, what is he doing with the investments? Can we spend enough fuck out of that money. Pansley buys a mansion. He bought a car, which at the time was a really big deal.

He bought two first class tickets to Italy for he and his wife, but then he changed them to have his mother come over. He also buys a macaroni company and a wine company in hopes of getting cash to repay the people who invested in the coupons they can't figure out how to make a profit of. She says, right. So the Italian guy brings his mother to him by his macaroni and wine. We sure he didn't just grow a big stereotype mustache and spend the rest of his life pissing his say I have nothing but appreciation for the guy who suffered through college

poverty and then bought his own macaroni and cheese company, though, right? Imagine like giant fountains of mac and cheese in front of them. He's swimming through him like Scrooge McDonough. We're all the ramen. So a Boston financial writer says there's no way this is a legit investment. You see, and Ponzi suits him for a while. And he wins. $500,000. Oh, Jesus.

Basically, this stopped other people from trying to investigate what he was doing, or at least speaking about it for the time being. Okay. what he was doing or at least speaking about it for the time being. Okay, new business plan. How many journalists are? We'll get him on a boat. How did he win this? How did he win this case? Like, did anyone ask him like seriously, like one question during the case, such as like,

how does this work exactly? Well, just to say, okay, he won. Well, basically we had England's version of won. Well, basically, we had England's version of libel laws back then. So you had to sow your mouth shut if you know. So on July 29th, 1920, the Boston Post wrote an article that made the investment seem like it had merit and it was great PR. People read the article and started giving him even more money. At this point, he's making a quarter million dollars a day. Oh my God. Hey, Cecil, as someone whose debit card got denied

at dinner the other night, I'm gonna need you to start making this sound bad. Because right now I'm gonna need to start one of these bad boys. You know what I'm saying? See, now the waiter brought it back and we had to do like, try this one thing. So, okay, Eli, word to the wise, it's crazy. Don't use a debit card.

That's nuts. That's your money. use a debit card. That's nuts. That's your money. Use a credit card. That's like a Ponzi scheme for your wallet. Just more of all, because those are all maxed out from my college debt. You were saying how this went bad. You sounded like you just started a Ponzi scheme with himself at the top and bottom. All right, but I got to feel like with this much money coming in, somebody had to really be looking into

this, didn't they? Well, there's several articles that come out that were asking hard questions about the investment. The post had asked the financial journalists who had it Dow Jones and company what he thought. And he said that he thought Ponzi was promising some pretty staggering returns on investments. He suspiciously did not have any of this money invested it feels like they're not focusing on the right thing to be skeptical about it's weird because we do have secret stocks that just constantly double in value but

paunzie doesn't have any you You know, it's almost the time people. It sounds question. What's the point? I don't want to add suit or anything. So I'm not saying this is a scheme, but I would rather feed my money to a hungry Chihuahua and wait for him to shit it out. They give it to this guy. Don't do me. Don't do me any dirty. The journalist also said that in order to cover the investments, there needed to be 160

million of these coupons in circulation. There's only 27,000. Oh Jesus. He also discovered while the profit margin was large, it's not large enough to cover the overhead of the redemption of these coupons. Okay. All right. Easy solution.

Print more coupons. You just need a catchy name for the printing press though, like a U.S. mint. You went into print more when you run out. It's also a Ponzi suit Okay, so Also Ponzi scheme back by the full faith and credit of like Medicaid hopes and dreams of all All of it's real. It's all on an illusion. Oh my god. I'm gonna stab you Okay, so they say there's no such thing as bad publicity. I feel like Ponzi's about to discover

their full of shit when they say that. So these stories start a panic and a ton of people running back to Ponzi to get their money out. They line up outside his office. So Ponzi walks out, shatted with people, bought them coffee and donuts, and a lot of these people left with their money still invested. Love this guy. Okay, well, been there, been there so many times. I've been giving a big rant about something and somebody just, you know,

centrally rubs a donut on my face with... I'm not sure. Yeah. My mom's tricky, I get it, I get it. Like Matt Lauer. Yeah. Yeah. I went with an important detail, because that sounds crazy, but like, what kind of donor?

I mean, that'll really be answered. Doesn't matter, Tom. Doesn't matter. So the local DA was not convinced. And so he decided odd at the company. The article said that this was a challenge because, quote, his bookkeeping system consisted merely of index cards with investors' names. What the fuck was that?

It's like his financial books are just like a recipe box like with like a bunch of index cards staying with red sauce, so he's like licking it like, these scams are delicious. Judgy. So Ponzi then, hires a publicity agent. The agent is in fold

and later describe Ponzi as aires a publicity agent. The agent is in fold and later describe Ponzi as a, quote, financial idiot who didn't seem to know how to add. I quote, this agent then finds some documents which clearly spell out the scheme. Ponzi stealing from the newer investors to pay off anyone cashing out. Okay, but why would he be keeping documents like that? You know what? Would you check with his secretary every

summer? Like Carol, can you come in here? Yeah, I want you to sift through the numbers and check if we're a giant scam or not? Still a giant scam? Yeah, great, great. Thanks. That'll be all car. He's got to know, like, like the publicity agent would be literally the last thing you'd want when stealing money. Right. I'm getting away with this. I'm going to need someone to make a great big public boss or I'm going to feel unloved. What?

All right. So beginning of the end. Yeah. Pretty much. The publicity agent goes public with this knowledge and writes a story that basically declares Ponzi and solvent. At the same time, a bank commissioner starts looking into the handover bank

that Ponzi was a controlling shareholder in and sees that they're making large loans to Ponzi. With this knowledge being public, the investors in the scheme decided to get their money back. And at a certain point, Ponzi is overdrawn. In fact, at this point, people who are not reimbursed or hit with the news that Ponzi is in fact $7 million

in debt. Okay, $7 million, that's $102 million, $425,696, and $97 cents overdrawn in today's money. That's like how many people basically at that point donated their money to this guy's, well, Danny said I needed to be successful. But that's a lot smaller than tax cut. We gave Walmart this year though. That's true. Also a Ponzi scheme. The bank commissioner seized handover bank because of all the shoddy transaction it was

making with Ponzi. And this pond, this foiled Ponzi's fail safe to use the vault there to pay out all his outstanding withdrawals. And that's weird because after you give the first guy a vault, you're pretty much honest. I don't know. I got this green lamp and a vise. And the vault doesn't.

True. On August 12, Ponzi surrendered to federal officials and they charged him with male fraud and larceny. So he posts bail, but the bail bonds have been decided to revoke it because he didn't trust Ponzi. I mean, it's dog. The bounty hunter's dad is about to get on a plane. He just gets flying tackled by like a lion centaur or wherever dog's dad would. I'm going to pray with your brother. All right. So what happens to all the investors? So his investors lost their shirt, so to speak.

Good, they're paying 30% on the dollar. His investors wind up losing $20 million, which is something like $225 million today. Ponzi was convicted of 86 counts of mail fraud and would have faced a lifetime in jail, but instead plea bargain one count and got five years in prison. One count, what the fuck, one count?

What's the 1919 equivalent to being black? Cause I bet he's glad he wasn't that bad. Wait a minute. That's still black. I think it's still black. Either that or Irish. That's not true. All right.

So you were supposed to make this sound bad for Eli, but five years. Yeah. You run it on a time. Five years. He runs it on a time. He gets a little worse. So that's all the federal government charges with him with after he gets out. He's then charged with state charges of larceny. He wound up suing the state claiming double jeopardy. The state

answered with what is go fuck yourself. And he lost the case. He then defended himself against the charges in court because he was in solvent and he couldn't afford a lawyer. He was only charged with 10 counts in the first trial, and it's a good thing because he won that trial. So then they charged him with five more cards to count your share. There's like, hi, yeah, hit the mercy. Can you do that? Can you just save counts behind the DA that can lose them? You're like, ah, I'm not left handed. Do over. I know, like, I love it. Like I get this guy with shit, but this doesn't seem kind of fucked up. It's like, I recharge was one thing every day for

a year. The next trial was deadlocked. And then it had to be retried and he finally lost. The next part of this article blew my mind though, quote, remarkably during his various prison terms, he continued to receive Christmas cards from some of his more gullible investors as well as request from others to invest their money from his prison cell. He's doing infomercials from jail. Just like rim jobs in D block are going for a nice cigarette premium. And just now, did Jim Baker read the sort of biography? I feel like he got his inspiration.

He did. I mean, he did get his inspiration here. Yeah. After release, he's involved in a real estate scam in Florida and arrested. He then posted bail again, and he tried to change his appearance and shave his head and poses a crewman on a ship to flee the country. And he's caught. He then served seven more years in prison. He's then released and he's deported. He then lived out the rest of his life and obscurity and died poor with only one friend.

See, worth it. I have two friends. That's why I shouldn't do that because I have a second friend. Right before his death, he proved what kind of shitty fuckery really was with this quote. Even if they never got anything for it, it was cheap at that price. Without malice of fourth thought. I had given them the best show that was ever staged in their territory since the landing of the pilgrims.

It was easily worth 15 million bucks to watch me put the thing over. Yeah, look, I got to say like I kind of right there with them, right? Like, how much do we spend on the Iraq war? That was just for shithead. Yeah, yes. Absolutely. I loved that he thought that up to get it? Two years. Absolutely. I love that he thought that up until then it was the pilgrim.

Yes. Really? Okay, so if you had to summarize what you learned in one sentence, see, so what would it be? Even if you're not sorry, sometimes it's okay to act sorry. All right, are you ready to face exponentially more difficult questions from our panel? I am. I am at that. Okay. So the obvious question I'm sure a lot of our listeners have is, how is what Ponzi did different from the housing crisis and the following bailout? Is

it a, the government printed more money so it's fine. P. Ponzi didn't get a multi-million dollar bonus when he got caught. See, people who lost their homes in the Ponzi scheme didn't have a feel-good movie with Steve Carell to make them feel better. Or D. Eat the Rich. Eat them. I think I'm going to go with D. It is.

I've always wanted to bring the rich person. It's very rare that you get a vegan giving you that advice. So when you hear it, usually that's going to be the singer vegan. You can eat the rich, they're not that tough. Very soft, very soft, nice quick sear. And then you're done. No, yeah, put them in the sheet for it now. Shoot the fire.

Not hard lives, man. Not hard life. All right, so I get, I've got one for you, depending on how you answer it, it'll probably change Heath's question. Which of the following is actually a Ponzi scheme? A, the Fed, just like my idiot conspiracy theorist cousin said. B, social security, just like his idiot dad said. I said hominem, I'm sorry.

Medicare, just like his idiot mom said. Another ad hominem, or D, the industrial size bottles of herbal supplements that were sitting unsold in their living room while they were saying all this shit is a true story. Remember he said first jokes that I made and say see. And I have to say he's right. You know, it's the formula here. Sorry, he's right, you know, it's the formula here. Sorry, he's right. When you take someone, you make the word for free.

I don't want to get it. It's fine. No, and it's okay. The person's poor, so the not poor person should work for free. It's great. Don't worry about it. Okay. This one is for Noah's cousin.

In what ways is the Federal Reserve exactly like a Ponzi scheme a none of the above That's it's hey, it's hey, it's not the above the other choices are be read a book and see I will stab you I'm gonna go with see I will I'm going to go with C. I will stab you. It is. I will stab you. All right. Ponzi schemes for doom to fail. Obviously, those are dumb. Which of the blow are definitely not Ponzi schemes and will surely work out just fine. So give him a shot. A cut co B Kirby vacuum. That's a nice college.

Yeah. $2,000 back. C trickle down economics. Right. Or D. Any job you can get without knowing anything at all and still be promised to make tens of thousands of dollars working from home. No, these are all bullshit. If no one would ever do anything else, how can you be so stupid? All right. Well, personal attack, whatever. Also, you could have just stopped at any job. That's how jobs have to work. I'm gonna, I, tell me more about this Kirby vacuum. I'm actually a whole house cleaning system.

What if I don't have a corkscrew? What can't you do with that? We're good question. Is there why pregnant? You don't want her to be? We have an attachment for that. Oh, it doesn't work out why I've just mistresses girlfriend. It's a separate attack. This isn't for cut co knives, right?

They're actually actually bonding together. New cuts, the flow bee version for the. Cut co-occurbie coming together gather I get you I get cut. Yeah All right, well I guess according to a complex advanced proprietary formula that only can be learned under a gibbous moon Thomas this week I mean time gets to take over his next week so he gets to pick next week's essay. All right, if it's my choice I pick Eli because I'm a glutton for punishment. All right. With that, I'll toss it over to Sarah for last week's Twitter answer.

And this week's Twitter question last week's question was what other catastrophes have been caused by a blown O ring. And the answer came from the Rebels advocate on Twitter. My above ground pool had a faulty o-ring in the filter. It resulted in an annoying slow leak. Water eroded a path through the sand which I bought by the bag, and eventually my lawn. Bad as the challenger?

Maybe not, but their ordeal was over pretty quick. Mine lasted all summer. This week's question is, write a high coup about Charles Ponzi. A high coup is a 17-cellible poem divided into three lines of five, seven, and five syllables. Just retweet our Facebook share this episode with your answer for a chance to be next week's winner. Back to you Noah. Alright, well for Tom Eli Heath and Cecilum. Noah, thank you for hanging out with us today. We'll be back next week and by then Eli will be an expert on something else. Between Back to you Noah. you everywhere you can, or both. And if you'd like to get in touch with us, check out the past episodes, connect with us on social media, or check the show notes, be sure to check out citationpod.com. 1955, $3,860.

Okay, spell the word dollar. D-A. There we go. There we go. W. No. No, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no The fed isn't a Ponzi scheme you don't know One of the other things you don't know what means if you say kind of a punts. No, it's not absolutely nothing like that I never balance these games. Would you explain the fed Eli? What what is the guys who arrest you for drugs?

We just did the whole thing what's the Ponzi's where you jump on the other frog We just did the whole thing. What's the Ponzi's where you jump on the other frog? I remember now Make care kind of is actually I mean like let's be real honest teeth come on Can't wait to be honest with each other. It can't be a fuzzy scheme if you can be forced to ban. Oh, my God. When you force someone to ban to it, it's just a funded tax.

But we want to call it a Ponzi scheme, though, to make Heath mad. Oh, OK. Nice. Nice. Oh, okay. I need to see.