Evening star. [volume] (Washington, D.C.) 1854-1972, 1920-08-11
STATE TAKES OVER
BANK where PONZI
KEPT HIS DEPOSITS
Continued from First Page.)

do some thinking" He finally OBJ
tanned financial assistance, he said. to
develop his idea, and spent thousa nds
of dollars in foreign correspondence.
II found out" he said, that the post
al coupons were being sold in for
eign countries for the equivalent of
s cents and could be converted into
postage stamps. Then all had to do
was figure how many nickels make a
million.
Il got in touch with men-that's
as far as I'll go-who were able to
pbns in different countries. They
bought them with our money and used
them as collateral. to be redeemed
later.
Once Boy to President.
when conditions were right I of
fered to borrow money from the pub
lie. l offered so per cent in ninety
days and would not promise to re.
deem notes in forty-five. though 7
thought that three weeks was about
the right time to bank the money
here, send it abroad, get the stamps
and convert them into cash.
Il started the Securities Exchange
Company. I was everything from
president to Office boy.
1.-THE second day after 1 opened a
gentleman from the chamber of com
merce came to my office to investi-
gate. He was convinced that my
scheme was possible. Ninety per cent
of the people didn't know about the
international reply coupons.
Post Office Inspector Comes.
''Then a post Office inspector came.
asked him if it was legal to buy
an international reply coupon abroad
and change it to stamps He said
| Yes 1 asked him if it was legal
to redeem millions of the commons
nd hn
decide whether they We're stolen or
where they came from.
"However, 1 decided that if I re-
deemed the stamps in the United
States the federal government might
decide that it came within it's iuris-
| or state law against it. But the ex-
change rate was the same in Switzer-
land and Norway and some other
countries. So I decided to redeem
them there"
Some one in the audience asked
why the postal authorities had heeu
unable to find any evidence of such
large dealings in reply coupons. Ponzi
replied that foreign governments
I realized profit on the issue of these
postal certificates land are not go
ing to disclose to other GOVERNMENTS
how many coupons they have issued"
"And the International Postal Union
| is not going to do it," he added.
Money Working i'm Europe.
| Asked if foreign governments had
| not stopped this, he replied:
| Yes, they are stopping-they have
! stopped the sale of coupons for public
use. But that does not stop my BUSH
| ness.
MY money in Europe is working
| today. even if it is not here"
In the transactions in coupons. he
| insisted, nobody suffers loss.
J II buy today" he said. "a dollars
worth of Italian exchange. At the
present rate 1 get IS lire. would
get five under normal exchange. With
1 the Is lire l buy so International re-
ply COUPONS, These coupons can be
sold for IS in American money!"
| He maintained that no government
need lose, because transactions be-
tween governments may be delayed
until exchange is normal, and point
ed out that there has been delay in
the payment of interest on American
| leans to the allies.
IT haven't found anybody who will
have to make it good" he asserted,
! when somebody wanted to know who
would have to stand the loss.