the buzz log

What's the latest craze that's taken the world by storm? Ponzi schemes! The term, up 166% in Search, has made a huge comeback thanks to Bernard Madoff's collapsed house of cards. But ol' Bernie isn't the only con-man to get busted — several other scam artists have been nailed for high-stakes grifting.

Two Men and a Ponzi
Two men who allegedly spent "$15 million of investor money to support lavish lifestyles" were brought up on federal charges this week. According to Chicago Business, the pair of jokers spent millions (not theirs) on "luxury vehicles, private jets, entertainment and the production of an unreleased film starring Tom Berenger and rapper Busta Rhymes." Searches on the failed company, One World, have roared to life as have searches on "one world ponzi."

$50 million scam falls apart
Another day, another arrest. CNN reports that the SEC has brought civil charges against Philadelphia's Joseph S. Forte for running a $50 million Ponzi scheme. According to the article, Forte recently confessed to authorities after his pyramid scheme fell apart. Queries on "joe forte" and "forte philadelphia inquirer" experienced large bumps.

The Enron of India
B. Ramalinga Rafu, the founder and chairman of Satyam Computer Services, recently admitted to concocting a massive financial scheme by cooking his company's books. Mr. Rafu resigned with a letter to his company's board of directors. Though not a Ponzi scheme in the traditional sense, the billion dollar fraud still sent shockwaves though the financial community and Search. Queries for "satyam scam" "satyam bankrupt," and "enron of india" all surged following the news.

Scheme targets Catholics
Bloomberg reports that U.S. authorities have sued an investment advisor and his firm for operating a Ponzi scheme "targeting elderly investors and members of the Catholic community." According to the NASDAQ, Richard Piccoli placed advertisements in Catholic publications, but never invested the funds in anything. The $17 million was instead used to "pay off other investors and perpetuate their fraudulent scheme."

How to avoid Mr. Ponzi
Not all investment managers are dirty, is only seems that way. The Washington Post offers some helpful advice on how to avoid getting ripped of by the next Bernard Madoff. Among the tips: find out who the investment manager uses to hold the assets and contact them directly rather than rely on the manager's word. Also, check in with the auditor often. You can also run a background check at the Financial Industry Regulatory Authority.