Identifying something is too good to be true generally means it is.

It's uncommon for there to be a perfect scenario that always makes you money with zero risk.

It's the nature of every get-rich-quick scheme out there.

Opportunities to make money by doing little physical work exist, but they usually come with a higher degree of

risk. That's what separates a legitimate financial investment from a Ponzi scheme. The fact that the

investment is described as no risk is the first red flag that anyone looking to invest their money

should notice.

Charles Ponzi was not the first person to have swindled investors by simply paying off existing clients with the money brought in from new clients. In the book, The Notorious Mrs. Clem,

Murder in Money in the Gilded Age by Wendy Gamber, the author claims that Nancy Clem carried out the first Ponzi scheme in 1868.

Another example is recorded in Munich, Germany in 1869, and it happened a few more times

throughout the rest of the 19th century.

But it was Charles Ponzi in 1920, who carried out the fraud on such a large and noticeable

scale that his name would go down in history as being synonymous with financial fraud.

Music Carlo Pietro Giovanni Grasioielmo Tobaldo Ponzi was born on March 3, 1882 in Lugo, Italy.

Most of the information about his early life comes directly from him, so its accuracy should be taken with a grain of salt. Fraudsters and conmen have a tendency to embellish or even flat-out lie

about their pasts to make their victims trust them more. According to him, he came from a wealthy

family who had fallen on hard times prior to his birth.

When he was old enough, he worked odd jobs, but was eventually accepted to the Sapienza

University of Rome. He spent more time hanging out with friends and drinking than studying,

and after a few years he was broke and had to leave. He had heard stories of other Italians traveling to the

United States where opportunities for success and wealth were plentiful, so he decided to follow

sued and head west across the Atlantic. The ambitious Italian immigrant, who went by Charles

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