The herald and news. [volume] (Newberry S.C.) 1903-1937, 1920-08-13
PONZI EXPLAINS
PART OF SCHEME
SAYS. NO ONE WILL SUFFER
LOSS.
Man Who Says He Has Become
Millionaire in Short Time
Recalls Start.

who claims to have jumped from
comparative poverty to a multlmll-
iionaire's estate in few months,
through dealings in international pos
tai coupons, told members of the XII
wants club. today some of the steps
in the process by which he claims to
have amassed his fortune. Ponzi,
making his first appearance as an
after dinner speaker since he be-
came one of the most talked of men
in the country, was luncheon guest
of the club. He was invited some
time ago, before he was compelled
to cease payment in his $50 per cent.
in 45 days" proposition because of
the orders issued by the state bank
commissioner to the Hanover Trust
company yesterday to pay no more
of Ponzi checks.
In opening his remarks Ponzl re-
iterated his claim that he was SOL
vent and expressed confidence that
this would be substantiated by the
federal and state investigations now
in progress and that he would be able
to resume business in a few days.
He related how he had hired
small office, used his small capital IN
various business schemes, and then,
with an international reply coupon
always in front of him on his desk1
ssbegan to do some, thinking" He
finally obtained financial assistance,
he said, to develop his idea, and
spent thousands of dollars in foreign.
correspondence.
Nickel. Make Millions.
sI found OUT" he said, "that the
postal coupons were being sold in
foreign countries for the equivalent
of six cents and could be converted
into postage stamps. Then all had
to do was to figure how many nickels
make million.
.'I got in touch with men-that's
as far as I'll go-who were able to
secure for me large amounts of cou-
pons in different countries. They
bought them with our money. and
used them as collateral to be redeem
ed later.
'sWhen conditions were right, I Of
fered to borrow money from the publ
lie. offered so per cent. in 80
DAYS and would not promise to re-
deem notes in As, though l thought
that three weeks was about right to
bank the money here, send it abroad,
get the stamps and convert them into
cash.
81 started the Securities Exchange
company I was everything from
president to office boy. l decided
that if 1 redeemed the stamps in the
United States the federal government
might decide that it came within It's
jurisdiction, though there was no
federal or state law against it. But
the exchange rate was the same in
Switzerland and Norway and some
other countries, so I decided to re-
deem them there"
Foreign Countries Silent.
Some one in the audience asked
why the postal authorities had been
unable to find any evidence of such
large dealings in reply coupons. Pom
ri replied that foreign governments
realized profit on the issue Of these
postal certificates and care not go
ing to disclose to other governments
how many coupons they have used :
"And the international Postal un-
ion is not going to do it," he added.
Asked if foreign governments had
not stopped this, he replied:
eyes, they are stopping-they
have stopped the sale of coupons for
public use. But that does not stop
my business. My money in Europe
IS working today, even if it is not
ere."
In the transactions in coupons ne
insisted nobody suffers loss.
IL buy today" he said, "a dollars
worth of Italian exchange. At the
present rate l get 18 lire. l would
get FIVE under normal exchange.
With the 1S lire 1 buy 60 interna-
tional reply coupons. These couI
pons can be sold for So in American
money"
He maintained that no government
need lose, because transactions be-
tween governments may be delayed
until exchange is normal, and point