A colloquial name for a fraudulent brokerage firm that uses high-pressure sales tactics to sell worthless or overpriced securities to unwary investors.
A Ponzi Scheme is a fraudulent investment scam promising high returns with little risk to investors. The scheme pays returns to earlier investors using the capital of newer investors rather than from profit earned by the operation. Named after Charles Ponzi, it eventually collapses when there are no new investments to cover withdrawals.
