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A ponzi scheme is an investment cheat in which existing investors are compensated with money from new investors. Ponzi schemes are called after Charles Ponzi. In the 1920s, Ponzi assured investors a 50% return within months on a purported investment in international postal coupons. Ponzi used money from new investors to pay false “returns” to previous investors.

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Ponzi scheme organizers often promise high revenues with little or no risk. Instead, they use new investors’ money to pay off previous investors and potentially steal some of that money for themselves.

Since Ponzi schemes have little or no legitimate income, they need a constant inflow of fresh money to survive. When attracting new investors becomes difficult or when a large number of existing investors withdraw, these projects tend to fail.

Here Are The Two Types Of General Ledger:

Nominal ledger: It contains information related to income, expenses, insurance, depreciation, etc.

Private ledger: It contains information like salaries, wages, capital etc.

The general ledger is used to record all of the financial transactions of a business. It is a central repository of financial data, and it is used to prepare financial declarations, such as the balance sheet and revenue statement.

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