Coworker was propositioned with a ponzi scheme....- Updated-Gets Worse | TigerDroppings.com

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TJG210
LSU Fan
New Orleans
Member since Aug 2006
22389 posts

Coworker was propositioned with a ponzi scheme....- Updated-Gets Worse



So I stop by to shoot the breeze with a co-worker and he tells me of this friend he had in college who is making a crazy amount in the stock market (25%), when the friend offered to invest his(co-workers) money and guarantee his principal for a period of 6 months, in which he would take a small cut for his services and give my co-worker the rest of the gains. I then informed him that was the very definition of Ponzi scheme.....unfortunately, my co-worker is just out of college so he is very naïve and said he is going to give the guy money. This was after I told him he was a moron for doing so.

Anyone else been approached by someone touting a deal like this?

Update: now the guy told my co-worker that he will give him $6,400 in 6 months for 4k now



This post was edited on 9/9 at 12:40 pm



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foshizzle
LSU Fan
Washington DC metro
Member since Mar 2008
30515 posts

re: Coworker was propositioned with a ponzi scheme....- Updated-Gets Worse


If he's first in it could work out well for him. Maybe.

What is really moronic is investing money in something you don't understand. He's basically giving someone a personal unsecured loan at a high promised interest rate, simple as that, with zero insight into how the gains will be maintained.






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Beerinthepocket
LSU Fan
Dallas
Member since May 2011
597 posts

re: Coworker was propositioned with a ponzi scheme....- Updated-Gets Worse


That's not the definition of a ponzi scheme, but it sounds like something that could end up being one.





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Geauxld Finger
LSU Fan
Baton Rouge
Member since Jan 2005
24935 posts

re: Coworker was propositioned with a ponzi scheme....- Updated-Gets Worse


He needs to check out what the investments are, how the broker is guaranteeing those returns, and what the are the behind the scenes issues the whatever firm this guy works for.

If it sounds too god or be true, it often is.






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Janky
LSU Fan
Team Primo
Member since Jun 2011
9273 posts

re: Coworker was propositioned with a ponzi scheme....- Updated-Gets Worse


Yeah, that may or not be a Ponzi scheme. However, it is definitely shady.





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LSU0358
LSU Fan
Member since Jan 2005
5357 posts

re: Coworker was propositioned with a ponzi scheme....- Updated-Gets Worse


When people start guaranteeing a return in investing/trading, don't just walk, but run as fast as you can from them.





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Ace Midnight
LSU Fan
Currently asymptomatic
Member since Dec 2006
33375 posts

re: Coworker was propositioned with a ponzi scheme....- Updated-Gets Worse


quote:

So I stop by to shoot the breeze with a co-worker and he tells me of this friend he had in college who is making a crazy amount in the stock market (25%)


25% is crazy? I made 25% the past year on my index funds. (although that is not typical, obviously, I don't consider it crazy - that's how 8, 10, 12 percent averages work - 3% 1 year, -1% the next, 16% the 13, etc.)






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ItNeverRains
LSU Fan
Franklin, TN
Member since Oct 2007
6914 posts

re: Coworker was propositioned with a ponzi scheme....- Updated-Gets Worse


I know a guy who if given 10k will give you a $500 visa gift card every month for life. I've got buddies in at 100k, getting 5k in gift cards a month for about 5 years and counting. Guy has never missed a payment, still I can't pull the trigger





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jimbeam
USA Fan
University of LSU
Member since Oct 2011
33604 posts
 Online 

re: Coworker was propositioned with a ponzi scheme....- Updated-Gets Worse


:|





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Meauxjeaux
Memphis Fan
I have 89,367 posts with my alters
Member since Jun 2005
17744 posts

re: Coworker was propositioned with a ponzi scheme....- Updated-Gets Worse


When can they get their $100k back and stop getting the gift cards?





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Ace Midnight
LSU Fan
Currently asymptomatic
Member since Dec 2006
33375 posts

re: Coworker was propositioned with a ponzi scheme....- Updated-Gets Worse


quote:

When can they get their $100k back and stop getting the gift cards?


They can't - they bought a "gift card" annuity, I would assume.

I'm wondering if the guy isn't faking the prepaid cards - surely he would have gotten caught by now, huh? Or, he has found some exploit with a prepaid program that somebody hasn't figured out yet - maybe an extended promotion.







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WikiTiger
LSU Fan
Member since Sep 2007
40721 posts

re: Coworker was propositioned with a ponzi scheme....- Updated-Gets Worse


quote:

I'm wondering if the guy isn't faking the prepaid cards - surely he would have gotten caught by now, huh? Or, he has found some exploit with a prepaid program that somebody hasn't figured out yet - maybe an extended promotion.


I might be wrong, but from what I understand about the gift card industry is that there are discounts offered to bulk purchasers. So, for instance, if you buy a shit-ton of $20 Red Lobster gift cards you can get them for like $15 each.

I don't know if the Visa gift cards work in a similar manner or not.

But this is basically how companies like Gyft.com make their money.






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jcole4lsu
Virginia Fan
The Kwisatz Haderach
Member since Nov 2007
27322 posts

re: Coworker was propositioned with a ponzi scheme....- Updated-Gets Worse


quote:

I might be wrong, but from what I understand about the gift card industry is that there are discounts offered to bulk purchasers. So, for instance, if you buy a shit-ton of $20 Red Lobster gift cards you can get them for like $15 each.

yeah its a good investment on the behalf of the retailer, red lobster in this example.
1) they know gift cards arent redeemed 100% (i dont know what the number is but i bet Darden group does)
2) even if #1 wasnt true, the gift card acts as a catalyst to get a customer in the door whom may have not come in previously. additionally, how many people spend EXACTLY whats on the gift card and nothing more? anything extra is profit that would not have been ordinarily realized.

i wonder how steep a discount this guy is getting






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idlewatcher
LSU Fan
Houston
Member since Jan 2012
10063 posts

re: Coworker was propositioned with a ponzi scheme....- Updated-Gets Worse


quote:

my co-worker is just out of college so he is very naïve and said he is going to give the guy money.


"A new college grad and his money are soon parted."






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ItNeverRains
LSU Fan
Franklin, TN
Member since Oct 2007
6914 posts

re: Coworker was propositioned with a ponzi scheme....- Updated-Gets Worse


quote:

When can they get their $100k back and stop getting the gift cards?


Anytime they want. The gift cards are prepaid $500 Visa. This is all I know in terms of the agreement. But the guys that do it are all very successful and swear by this guy.






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LSU0358
LSU Fan
Member since Jan 2005
5357 posts

re: Coworker was propositioned with a ponzi scheme....- Updated-Gets Worse


quote:

25% is crazy? I made 25% the past year on my index funds.


25% isn't unreasonable (or impressive) when you consider the Dow is up 24% from June of 2012 to today.

What should be scary is the "Guarunteed 25% return." In the stock market there is no such thing as a sure thing.






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gamatt53
Georgia Fan
Member since Nov 2010
787 posts

re: Coworker was propositioned with a ponzi scheme....- Updated-Gets Worse


quote:

Anytime they want. The gift cards are prepaid $500 Visa. This is all I know in terms of the agreement. But the guys that do it are all very successful and swear by this guy.


how does tax work on this? Can't be legal right?






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Camp Randall
Wisconsin Fan
The Shadow of the Valley of Death
Member since Nov 2005
13637 posts

re: Coworker was propositioned with a ponzi scheme....- Updated-Gets Worse


quote:

Anyone else been approached by someone touting a deal like this?


Yes I asked a few pointed questions and they changed the subject abruptly. I like to do this to Amway etc drones too.






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Captain Ron
Hawaii Fan
Location: Ted's
Member since Dec 2012
3841 posts

re: Coworker was propositioned with a ponzi scheme....- Updated-Gets Worse


quote:

So I stop by to shoot the breeze with a co-worker and he tells me of this friend he had in college who is making a crazy amount in the stock market (25%)


I'm up nearly 35% in 4 weeks.

My scheme: Buy low, sell high.






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tigerpawl
LSU Fan
Can't get there from here.
Member since Dec 2003
5293 posts

re: Coworker was propositioned with a ponzi scheme....- Updated-Gets Worse


quote:

If he's first in it could work out well for him.
Only a person with a screwed up moral compass would knowingly invest in a scheme that by definition screws the late investors.






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