{"page":"\u003clink rel=\"stylesheet\" href=\"https://lessonplanet.com/assets/packs/css/resources-572d6a42.css\" /\u003e\n\u003clink rel=\"stylesheet\" href=\"https://lessonplanet.com/assets/packs/css/lp_boclips_stylesheets-f4d0de30.css\" media=\"all\" /\u003e\n\u003cdiv data-title='Prosecutors say Bernard Madoff used a Ponzi scheme to bilk people out of $50 billion. So just what is a Ponzi scheme' data-url='/boclips/videos/5c54c58cd8eafeecae171084' data-video-url='/boclips/videos/5c54c58cd8eafeecae171084' id='bo_player_modal'\u003e\n\u003cdiv class='boclips-resource-page modal-dialog panel-container'\u003e\n\u003cdiv class='react-notifications-root'\u003e\u003c/div\u003e\n\u003cdiv class='rp-header'\u003e\n\u003cdiv class='rp-type'\u003e\n\u003ci aria-hidden='true' class='fai fa-regular fa-circle-play'\u003e\u003c/i\u003e\nVideo\n\u003c/div\u003e\n\u003ch1 class='rp-title' id='video-title'\u003e\nProsecutors say Bernard Madoff used a Ponzi scheme to bilk people out of $50 billion. So just what is a Ponzi scheme\n\u003c/h1\u003e\n\u003cdiv class='rp-actions'\u003e\n\u003cdiv class='mr-1'\u003e\n\u003ca class=\"btn btn-success\" data-posthog-event=\"Signup: LP Signup Activity\" data-posthog-location=\"body_link_boclips\" data-remote=\"true\" href=\"/subscription/new\"\u003e\u003cspan\u003e\u003cspan\u003eGet Free Access\u003c/span\u003e\u003cspan class=\"\"\u003e for 10 Days\u003c/span\u003e\u003cspan\u003e!\u003c/span\u003e\u003c/span\u003e\u003c/a\u003e\n\u003c/div\u003e\n\u003c/div\u003e\n\u003c/div\u003e\n\u003cdiv class='rp-body'\u003e\n\u003cdiv class='rp-info'\u003e\n\u003cdiv aria-label='Hide resource details' class='rp-hide-info' role='button' tabindex='0'\u003e\u0026times;\u003c/div\u003e\n\u003ci aria-label='Expand resource details' class='rp-expand-info fai fa-solid fa-up-right-and-down-left-from-center' role='button' tabindex='0'\u003e\u003c/i\u003e\n\u003ci aria-label='Compress resource details' class='rp-compress-info fai fa-solid fa-down-left-and-up-right-to-center' role='button' tabindex='0'\u003e\u003c/i\u003e\n\u003cdiv class='rp-rating'\u003e\n\u003cspan class='resource-pool'\u003e\n\u003cspan class='pool-label'\u003ePublisher:\u003c/span\u003e\n\u003cspan class='pool-name'\u003e\n\u003cspan class='text'\u003e\u003ca data-publisher-id=\"30356011\" href=\"/search?publisher_ids%5B%5D=30356011\"\u003eCurated Video\u003c/a\u003e\u003c/span\u003e\n\u003c/span\u003e\n\u003c/span\u003e\n\u003c/div\u003e\n\u003cdiv class='rp-description'\u003e\n\u003cspan class='short-description'\u003eHEADLINE: How does a Ponzi scheme work?CAPTION:  Prosecutors say Bernard Madoff used a Ponzi scheme to bilk people out of $50 billion. So just what is a Ponzi scheme. (Dec. 17)[Notes:ANCHOR VOICE]  The news that Wall Street money manager...\u003c/span\u003e\n\u003cspan class='full-description hide'\u003eHEADLINE: How does a Ponzi scheme work?\u003cbr/\u003eCAPTION:  Prosecutors say Bernard Madoff used a Ponzi scheme to bilk people out of $50 billion. So just what is a Ponzi scheme. (Dec. 17)\u003cbr/\u003e[Notes:ANCHOR VOICE]  \u003cbr/\u003eThe news that Wall Street money manager Bernard Madoff was arrested last week has many people wondering just how what happened to their money.\u003cbr/\u003eProsecutors say he defrauded investors out of 50-billion dollars through a pyramid scheme.\u003cbr/\u003eWhile there are several types of pyramid schemes--Madoff's actions have also been referred to as a Ponzi scheme--which is a particular type of pyramid scheme.\u003cbr/\u003eThe name goes back to Charles Ponzi. In 1920 he pleaded guilty and went to federal prison after being charged with 86 counts of fraud.\u003cbr/\u003eIn a Ponzi scheme, the schemer acts as a \"hub\" for the victims--interacting with all of them directly. \u003cbr/\u003eA Ponzi scheme claims to rely on some esoteric investment approach--like insider connections. It often attracts well-to-do investors. In Madoff's case, he once was chairman of the Nasdaq.  Alleged victims include director Steven Speilberg and real estate magnate Mort Zuckerman.\u003cbr/\u003eThe reality of the scheme is that the \"return\" to the initial investors is being paid FROM new incoming investments, not FROM profits. \u003cbr/\u003eOne reason that the scheme initially works so well is that early investors-those who actually got paid - OFTEN  reinvest their money in the scheme\u003cbr/\u003eTHUS, THE SCHEMERS don't ACTUALLY HAVE TO PAY OUT MUCH. THEY JUST NEED TO SHOW STATEMENTS INDICATING A RETURN HAS BEEN PAID. \u003cbr/\u003eBut the schemes usually come to one of three ends:\u003cbr/\u003eTHE PROMOTERS AND THE FUNDS VANISH  or THE SCHEME COLLAPSES UNDER ITS OWN WEIGHT, OR IT GETS EXPOSED. \u003cbr/\u003eIn this case, court papers indicate Madoff exposed the scheme by telling two senior employees that he defrauded investors.\u003cbr/\u003e\u003c/span\u003e\n\u003c/div\u003e\n\u003cdiv class='action-container flex justify-between'\u003e\n\u003cbutton aria-expanded='false' aria-label='Read more description' class='rp-full-description' type='button'\u003e\n\u003ci class='fai fa-solid fa-align-left'\u003e\u003c/i\u003e\n\u003cspan id='read_more'\u003eRead More\u003c/span\u003e\n\u003c/button\u003e\n\u003cdiv class='rp-report'\u003e\n\u003c/div\u003e\n\u003c/div\u003e\n\u003cdiv aria-labelledby='resource-details-heading' class='rp-info-section'\u003e\n\u003ch2 class='title' id='resource-details-heading'\u003eResource 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