Trading scams and big investment frauds have resulted in the loss of billions of dollars for gullible people. Here's a look at some of the world's biggest frauds.
Charles Ponzi
Charles Ponzi, an Italian immigrant to the United States, became one of the greatest fraudsters in America. The term 'Ponzi scheme' describes a scam that relies on a pyramid of investors who contribute money to a fraudulent programme.
Ponzi used to do odd jobs and would always end up being caught for some theft or forgery. In Canada, he worked for a bank where he forged signatures on cheques: he was sent to jail for 3 years. But this did not deter him from moving ahead.
He duped many people with a Ponzi scheme. Investors are attracted with promises of big returns. The returns were given to investors initially out of the money they invested.
Ponzi duped many investors in 1919 making them believe that investments in foreign postage coupons could yield 50 per cent returns in 45 days.
He said by selling cheaply bought coupons from abroad for huge amounts, investors could double their money in three months. Many working people who wanted to make more money in a short span of time joined the scheme. Soon many more people joined the conman on high hopes.
Ponzi was convicted of mail fraud in 1920 and was imprisoned before he was deported to Italy in 1934. He is aid to have died penniless in Rio de Janeiro in 1949.
Bernard Ma doff
European investors face billions of dollars losses in the wake of disclosure of 'Ponzi' scheme run by Ma doff.
European banks, including Spain's Grupo Santander SA and France's BNP Paribas, were quoted by the Wall Street Journal as saying that their clients and shareholders face billions of euros of losses on investments, underscoring the global reach of the alleged Ponzi scheme run by the veteran New York money manager.Santander, the eurozone's largest bank by market value, said its clients had an exposure of 2.33 billion euros ($3.1 billion) to Madoff's investment funds, mainly through its Optimal Strategic US Equity fund.
The company had hired Madoff's firm to execute the Optimal fund's investments. Santander vowed to "undertake the legal actions which may be needed to defend the interests of investors."
The Journal reported that BNP, France's largest bank by market value, said it could lose as much as 350 million euros as a result of the alleged fraud.
More than two billion euros belongs to institutional investors and international clients of Santander's private-banking business, which provides services to wealthy individuals, it was quoted as saying. The remaining 320 million euros belongs to private-banking customers in Spain, where the bank is based.
Jerome Kerviel
He hacked into the bank's computers to carry out his trading tricks. The French bank took a hit of 5 billion euros in one of the world's largest scams.
His total salary and bonuses amounted to less than euro 100,000. Kerviel joined SocGen after earning a masters degree in finance at a business school at Lyons in 2000.
Reed Eliot Slatkin
Slatkin's scheme collapsed in 2000 following a civil action by John Poitras resulting in attachment of most of Slatkin's property. Since 1986 Slatkin had raised approximately $593 million from over 500 wealthy investors.
Creditor claims are reported to be approximately $255 million.
Many Hollywood celebrities also lost lots of money as they got trapped in the Slatkin net.
Brian Hunter
Amaranth, which had over $9 billion in assets, collapsed in 2006 after Hunter's gamble on natural gas futures market went haywire.
With a master's degree in mathematics from the University of Alberta, Hunter moved to New York to join Deutsche Bank in May 2001. He made $69 million for the bank in his first two years.
By 2003, Hunter was promoted as head of the bank's natural gas desk. He soon left the bank accusing the bank of defaming him.
Hunter has been slapped with a fine of $30 million by the Federal Energy Regulatory Commission for the alleged manipulation of natural gas prices in 2006.
Giancarlo Paretti
In 1990, Parretti also bought Metro-Goldwyn-Mayer, using money borrowed from a Dutch subsidiary of Credit Lyonnais.
Parretti enjoyed a lavish life and squandered the company's money.
Parretti faced securities fraud charges in the United States and Europe. Pathe was purchased by Chargeurs in 1992.
In March 1999, Parretti was found guilty of misuse of corporate funds and fraud and he was sentenced in absentia to four years in prison and fined 1 million francs by a Paris court.
John Meriwether
Meriwether, founder of Long Term Capital Management that collapsed in 1998. The company lost $4 billion and created panic across global markets.
Meriwether, runs JWM Partners which is facing tough times again with his largest fund losing 28 per cent of its value this year.
After graduation, Meriwether moved to New York City, where he worked as a bond trader at Salomon Brothers.
At Salomon, Meriwether rose to become the head of the domestic fixed income arbitrage group in the early 1980s and vice-chairman of the company in 1988. In 1991, after Salomon was caught in a Treasury securities trading scandal, Meriwether was slapped with a $50,000 civil penalty.
Nick Leeson
Leeson initially absconded, but was later arrested and jailed in Singapore.
He was released in 1999 and went on to write the bestseller, Rogue Trader. The book has been turned into a movie.
Leeson is now the chief executive of Irish football club Galway United.
Yashuo Hamanaka
Nineteen companies constitute the core group of the Sumitomo Group.
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