Question

explain in depth what is a ponzi scheme?

Answer 1

Ponzi scheme is always considered a fraudulent Investment program which will be involving various types of payments collected from new retail investor to to pay the earlier investors so,they are not making any money and instead they are paying the old debt with the new debt and the organisers of the ponzi scheme are usually promising to invest the money they collect to generate supernormal profit with little or no risk.

In the ponzi scheme it is always the the motivation of the organiser to not invest the money of the investor and they are generally paying off the earlier investor and they are trying to attract this new investors by making the scheme look believable so on the scheme will be requiring a constant flow of fun to sustain itself and they will be generally trying to sustain in a bull run when organizers will be trying to build on the expectation of the people to maximize the profit.

Hence can we say that ponzi scheme will be providing them with the fraudulent practice of the looting off Investor by additional money and paying the old debt so as far as the additional money is coming in,the fund is going to sustain itself, & it is very important to adapt proactive mechanism in order to stop this ponzi scheme.