Evening times-Republican. [volume] (Marshalltown, Iowa) 1890-1923, 1920-07-27
Six Cents Makes
millionaire of
Legal Financier

y
was placed yesterday upon the &C
tivities Of Charles Ponzi, president
Of the Securities Exchange Company
Of thia city, who altho virtually
without funds year ago, mas mads
vestors by an astoundingly simple
scheme,
In obtaining Ponzrs consent to a
temporary cessation of his business,
District Attorney Pelletisr made IL
clear that there is no evidence OF
illegal action on the part Of Mr..
Ponzi, who stated yesterday that he
owes about three millions" and
stands willing to pay that Hum to all
investors demanding their money
back ION twelve hours notice"
For raore than two weaks it has
been necessary to have police re-
serves ct the offices Of the Securities
Exchange Company to keep the
throngs Of investors in order as they
waited the opportunity to place their
money with the company. Yester-
day more than 1000 investors were
turned away. grumbling, when the
company decided to pause in it's rou-
tine and invited investigation.
Mr.. F'onzi's remarkable business is
based upon the use of the interna-
tional reply coupon authorized under
the international postal agreement as
the medium for taking advantage OF
the difference in rates OF exchange.
II sirnply buy International cou-
pons," explained Mr.. Ponzi to the
district attorney. "They are ex-
changahle into stamps and l take
care to buy them where the rates OF
exchange are such that 81 of Amer
lean currency Is really worth 81 or
more In the native currency. there
fore get So clear on the transaction
and can well afford to pay back the
original 81, and so cents additional
as interest to the investor. My mar
gin OF profit lis enormous, but have
the system and the offices abroad
The investors margin OF profit IL
tremendous in proposition and ne mas
no responsibility and is entirely GER
tain Of his money.
IT hit upon the scheme Just a year
ago in August, when thought OF
issuing an export publication on
small scale. wrote to a friend IN
Spain regarding 1t, and In reply re-
ceiyed AN international coupon, which
/ was to exchange for stamps to send
q copy Of the publication to my
friend.
"The coupon cost about l cent In
United States money in Spain and
i could get 6 cents in stamps for II
here. @f..a.S
d. ssSeiscs then I have bought. the cou-
pons by the millions IN countries
where the rate is satisfactory.
have made millions for myself and
my investors, all OF whom get their
money back and so per cent interest
in forty'-five days. Right now have
So, 900, 900 in investors. money. | will
gladly return it without interest to-
morrow.
Mr.. T'onzi explained that the cou-
pons are frequently transmitted by
agents from one European country to
another. gathering profits thru sue
| y = -
ceedinx differences in rates Of ex-
change up to as high as 700 per cent
In some, Instances. Then the proceeds
are reconverted into American dol
lars.
Mr.. I,onzi claims no credit for the
plan and expects no blame for 1t.
"All ]. did was to get paid for
%v,jul,iv,v ~ if0 he said
The district attorney will have an
audit made Of the company's books
at Mr.. .Ponzi's request, and Mr.. Ponza
has indicated that he may give up
the business anyway when the audit
is completed.
"Alf my customers and investors
have made small fortunes" he SAID
"and don't want any more money
for myself"