What is a Ponzi scheme?

A Ponzi scheme is a fraudulent investing system promising high rates of return with little risk to investors. In brief, a Ponzi scheme generates returns for older investors by acquiring new investors. In this, a Ponzi scheme is similar to a pyramid scheme, since both are based on using new investors' funds to pay the earlier ones. Companies that engage …

Is Herbalife a fraud? Bill Ackman says it is a huge one

It was May 1st , 2012 when David Einhorn, a well-known hedge fund manager, founder and president of Greenlight Capital, asked accurate questions about Herbalife International's business and sales models during the first quarter's earnings call, setting off suspicions that he had a short position on the stock. In fact, in January 2013 Einhord revealed that …