新职业英语2经贸版Unit4(精编资料 ).ppt

Notes Notes Text A-2 A typical Ponzi scheme promises investors a high rate of returns in a short time. The money that is collected from investors is used to pay the returns. This means the fraud can run for some time, because investors appear to be making the promised returns. Early participants can profit, as they can with a pyramid scheme. However as the scheme needs more and more “investors” to keep joining, it is inevitable that it will eventually run out of people who are willing to join. The result is that the fraudster makes a large profit, people who join early also make profits, and those who join later lose their “investments”. Text A-3 The easiest way to explain this is with an example. Suppose the scheme promises a return of 10% a month. The fraudster simply takes investors’ money and returns a tenth of it at the end of every month. The fact that investors appear to be getting the returns they were promised will encourage more people to put their money in the scheme, and even encourage the original wave of victims to reinvest. After ten months the fraudster will have returned all the money invested by the very first investors (assuming they did not reinvest), but will have most of the money invested by later investors. At this point the fraudster simply takes the money and disappear. Text A-4 Common types of Ponzi scheme operate under a variety of names including “high yield investment program” and “high yield bonds”. Their common characteristics are very high returns with no clear underlying business to generate them. Text A-5 More complex forms of Ponzi scheme can be harder to detect. They may well appear to be legitimate investments. They may even be part of an investment that includes both legitimate and Ponzi elements. An example of the latter is an investment company that offers very high returns to depositors, and does lend the money (as a real investment company would) to make returns, but does so knowing that the returns