The Ponzi Scam - it's still here, and it's still huge
Updated: Sep 5
The Ponzi Scheme, named after 1920's con artist Charles Ponzi creates the illusion of a thriving business when the reality is, earlier investors are paid returns from new investors under the guise of profit. The system inevitably fails when the operator runs out of new investors.
Ponzi scams are very much alive today. Scammers now use modern forms including cryptocurrency, fake foreign exchange trading, and online advertising packages instead of traditional paper certificates of old.
The largest ever British Ponzi scheme, is not as old as we would like to think. London Capital & Finance were found liable to pay £180 million, while another three men connected for "dishonest assistance" were liable for £211 million, this totalled liable of almost £400m, making it the "largest Ponzi scheme in British history" according to the BBC. More than 11,600 investors were issued mini bonds from the LCF which raised £237m between 2013 and May 2018. It went into administration 2019. The High Court hearing finalised December 2024. Court documents stated directors spent funds on supercars, property, political donations and luxury travel.
Woodville Consultants Limited placed into administration in July 2026 by order of the High Court, raised more than £390 million from investors, via high-risk "loan notes" (mini-bonds) before facing active Ponzi scheme investigations. Reports on the 25th August 2026 suggest, administrators sorting out the defunct litigation funder Woodville are examining claims, that Woodville used funds obtained from new investors to fulfil return promises made to earlier investors, according to the Law Gazette.
Woodville Consultants Limited was noted in a FCA warning regarding loan note schemes to investors.
Be aware of:
Guaranteed returns: Promises of high profits, little to no financial risk.
Overly consistent gains: Investments that always make money, even when the market goes down.
Unregistered sellers: People or firms not registered with official financial regulators like the SEC or the FCA.
Complex Strategies: That sound too complex to explain or verify.
This article is general fraud-prevention information, not financial advice.
Comments