EnRon made headlines. Years after EnRon, a guy who had been collecting tens of millions of dollars to invest for well-to-do people didn’t even bother to run away. After over a decade of this, the police came to arrest him and he said, “I was wondering when you were going to catch on.”

We call these Ponzi Schemes as if Ponzi was a special case. But in the real world they are routine.

Like the rest, this guy got some reputable people to hand him their money and others asked about him and were assured that reputable people trusted him.

People do not understand history because they are always astonished to hear about EnRon getting hundreds of millions in investments and having nothing. In the 1880s people invested millions of dollars in Ullyses S. Grant’s Grant and Ward Company. Nobody, least of all Grant, knew that Ward wasted every dime. Grant died deeply in debt, and those who had invested lost all their savings.

In each case I have cited, and in hundreds more,  and in hundreds occurring right now, it is not that there are not enough assets to cover liabilities. It is not that someone is “mistaken.”

There is NOTHING there.

Except some people you checked with. And they may make a few calls and you go ahead and do what they recommend.

I know of no case in my personal or studied history where anyone who was asked about this sort of thing ever suffered the slightest loss of reputation for vouching for the Ponzi.