← Easy Money: The Charles Ponzi Story
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- [00:03]
Narrator
For nine days straight, Ponzi had occupied the front page of the Boston Post with headlines and reporting that was increasingly skeptical and aggressive. But the headline on the morning of Monday, August 2, 1920, went even further.
- [00:17]
Charles Ponzi
Extra, Extra. Ponzi hopelessly insolvent. This says Ponzi has no money. What? Give me that. Publicity expert employed by financial wizard says Ponzi has insufficient funds. That can't be right. See for yourself.
- [00:35]
Narrator
After promising to blow the whistle on Ponzi, McMasters had delivered. He'd spent all weekend working on his report, and now it was finally out in public.
- [00:44]
Charles Ponzi
He thinks he has millions, but he's broke. Nobody will deny it after reading the story. Says who? His publicity guy turned on him. Right reside on the front page.
- [00:52]
Narrator
Strong words.
- [00:53]
Charles Ponzi
He must be confident, risking a lawsuit like that.
- [00:57]
Narrator
He was confident, but he also wasn't taking any chances. McMasters had combed through Ponzi's office looking for any deposit slips he could find, trying to confirm how much business Ponzi was really doing. And after his own investigation, McMasters was more certain than ever.
- [01:15]
Charles Ponzi
If any money is paid out today at Ponzi's office, it will be at the expense of those foolish enough to maintain. Sergey, didn't you invest with the men? God damn Italians. You should have known.
- [01:33]
Narrator
It was a shocking turn of events that reverberated throughout Boston, but there was very likely no one more shocked than.
- [01:41]
Charles Ponzi
Lies. It's all lies, Rose. I can't believe I let the man into our house. Charles, take a deep breath. No, I can't. I need to get out there. Mcmasters and the Post are hoping that I panic. So you know what? I'll do the opposite. I'll flash the town with the biggest smile I've ever seen. Good idea. I'll come with you. Yes, yes. Good, good. No, that will help with appearances. And to be by your side because you want me by your side. That too. That too, of course. Yes. Wait. Go get the nice jewelry you have. We need to look the part more than ever. We returned all my nice jewelry. We're rich. We're successful. We are absolutely not worried about these desperate accusations.
- [02:23]
Narrator
Mm. This is easy money. The Charles Ponzi story. An Apple original podcast Produced by At Will Media. This show incorporates real interviews and historical research alongside dramatic reenactments and actors voices. It was Monday, August 2, 1920, about eight months after Ponzi had started his stamps business. One week since the Boston Post had framed first launched an attack on him, which pressured him into an audit. And just 48 hours since, his publicity man, William McMasters, had promised that same paper he would blow Ponzi quote sky high. That expose ran on the front page of the paper, and the lines outside Ponzi's office began forming almost immediately. By the time the doors opened, there were thousands of people in the street waiting to get their money back. So far, everyone who'd wanted to withdraw had been able to, which remained his primary defense against both government investigators and the press. But eventually, he would run out of money. And though Ponzi had managed to calm things down by the end of the previous week, McMaster's expose was whipping up a whole new kind of frenzy.
- [03:58]
Charles Ponzi
Hello. Good to see you all so bright and early.
- [04:03]
Narrator
Not that he let it outwardly affect his mood, which perhaps more than anything was his superpower at this point.
- [04:09]
Charles Ponzi
Thank God the Post didn't run that editorial in the winter, or we'd be all standing out here to freeze. Especially me, since apparently I'm too broke to afford a jacket.
- [04:22]
Narrator
One member of Ponzi's staff quit, outraged at McMaster's claims. But otherwise, everyone showed up and did their job, working their way through the line outside.
- [04:33]
Charles Ponzi
Everybody who wants their money will get it, no questions asked. But I feel obliged to remind you that once your money is out, your promised returns disappear with it. And when this audit is complete and the Post is left with a hefty libel suit, I'd hate to see you all disappointed then. But it's entirely your decision. Just think about it while you wait in line. And in the meantime, my lovely wife Rose will be around to offer some lemonade.
- [05:06]
Narrator
The line lasted all day and ended only once the office closed. In fact, they had to shut their doors early, which briefly caused an uproar.
- [05:16]
Charles Ponzi
I'm afraid the building is full, and it will take the rest of the afternoon to deal with those already inside. So we have to close for now. I promise. This is merely a problem with my office space, not my finances. I'll come back tomorrow and we'll try this all over again. I'll even have sandwiches to go along with the lemonade. Charlie, over here. What's the matter, dear? This poor woman. She's been here all day. Everything is fine. Your money is safe. I promise. I waited for hours.
- [05:52]
Narrator
I can't do it again tomorrow.
- [05:54]
Charles Ponzi
Of course not. I'm sure these people won't mind if you cut ahead and we squeeze one more person in today. Come with me. We'll get your money right away.
- [06:05]
Narrator
By the end of the day, he'd lost hundreds of thousands more dollars. Yet Ponzi sensed the crowd starting to turn in his favor. At one point, he'd walked around the corner to meet with government officials about the state of the audit and was tailed by a group of admirers. On the short journey, Poncey was even described by one reporter as being, quote, as calm and undisturbed as a mill pond. All of which came as an especially big surprise to one person in particular, William McMasters. As he wrote in his memoir, now that Ponzi was out in the open, where any newspaperman could go after him, I honestly figured that every evening edition.
- [06:44]
Charles Ponzi
Would fall right in line with my Post story. I was never more wrong in my entire life.
- [06:51]
Narrator
Though the Boston Post would continue its campaign against Ponzi, none of the other papers seemed willing to follow suit, Even after everything McMasters had put his name to. He wrote in his memoir that another reporter even accosted him on the street that day, shouting, Damn you, Bill McMasters.
- [07:09]
Charles Ponzi
You have tried to ruin one of the finest little men who ever came to Boston, but he will beat you and your damn paper.
- [07:17]
Narrator
Which is surprising that McMasters would have so little support, because not only was he a former journalist himself, but his piece wasn't even speculation. The expose included a list of serial numbers from actual deposit slips to show, mathematically, that Ponzi simply wasn't bringing in enough to generate the kinds of profits he was reporting. And yet it wasn't enough to bring him down or to blow him sky High, as McMasters had promised. And to understand why, we can look to another Ponzi schemer, the biggest of all time, Bernie Madoff.
- [07:53]
Charles Ponzi
I didn't even know who the guy was, but I looked him up, and he was the chairman of the nasdaq. He was a big advisor to the SEC on new products, and he was trading probably close to 5 to 10% of the total daily volume of the stock market each day.
- [08:13]
Narrator
That's Frank Casey, a former investment professional who actually has two connections to this story.
- [08:19]
Charles Ponzi
By the way, my old office was in the exact office that Charles Ponzi ran his operation out of on School.
- [08:26]
Narrator
Street in Boston, which is pretty wild. But it's his role as a whistleblower on Bernie Madoff that's of particular interest to us now. Bernie Madoff, as we've heard, stole $65 billion in a scheme that lasted decades. He claimed to be trading stone stock options. Those are contracts that allow you to buy and sell stocks at predetermined prices. Madoff claimed he was trading options in a way that would guarantee he would always make money.
- [08:53]
Charles Ponzi
Well, I was an options expert by then, so I knew what you could not do with options, and it doesn't produce a 1% return like clockwork.
- [09:02]
Narrator
What was your reaction to seeing strong credentials in the face of so many red flags?
- [09:08]
Charles Ponzi
Quite frankly, I immediately said to myself, bullshit.
- [09:12]
Narrator
Frank told his bosses that he thought something was off, and they pointed him in the right direction.
- [09:17]
Charles Ponzi
And I said, I need to understand what he's doing, this Madoff guy, because he's not doing what he says he's doing. And they said, oh, let's go see Harry Markopoulos, the portfolio manager. He's a meth whiz. He'll figure it out. So I went down to see Harry, and in three minutes, I mean, he looked at me and looked at the bosses and he said, it's a fraud and it's probably a Ponzi scheme.
- [09:39]
Narrator
Frank clearly knew something was wrong and is one of the three people credited with leading a thorough investigation into Madoff's finances, along with that, quote, math whiz colleague Harry Markopoulos. But even he admits that at first he wasn't so sure Harry was right. Run of the mill fraud, perhaps, or insider trading. But a Ponzi?
- [10:01]
Charles Ponzi
I said, oh, my God, don't use that word, Ponzi. He is a Goliath on Wall Street. You don't call this guy a fraud, let alone a Ponzi, unless you have proof. So he said, let's go get it.
- [10:13]
Narrator
And they did. They spent years digging into Madoff's business. They alerted the securities and Exchange Commission a number of times, submitting five separate investigative reports between May 2000 and April 2008, with as many as 30 red flags that pointed to inconsistencies within and and suspicions about Madoff's business. And what did the SEC say?
- [10:36]
Charles Ponzi
Well, these guys were just disgruntled competitors.
- [10:39]
Narrator
Which is what some people said about McMasters, too, that he was just a disgruntled ex employee, never mind that he had quit and for the very reasons he alleged in his. But people wanted to believe in Madoff just like they wanted to believe in Ponzi. And that belief was enough for many to brush aside the accusations. And so nothing changed, even though Frank and Harry had shown that there simply weren't enough options in all of existence for Madoff to be trading at the volume he claimed he was. Much like the Boston Post, which had a financial analyst showing that there simply weren't enough stamp coupons for Ponzi to do what he did. And on top of that, there was McMaster's. In both cases, this all went beyond speculation. It was mathematically impossible for Madoff, like Ponzi before him, to be doing what he said he was doing. Why, in the face of this kind of evidence, would a fraudster not be immediately arrested? And why was nobody else asking these questions about Madoff?
- [11:36]
Charles Ponzi
That is the question that we tried to answer for eight years, but we just did not understand why people were willing to be so stupid.
- [11:49]
Narrator
That's not quite how McMasters put it in his memoir, but after seeing the reaction of that fellow journalist who was so angry at what McMasters had done, he knew that he was dealing with emotions rather than logic, which is probably about as good an answer as you'll get to Frank's question. And by the way, after they stalled out with the SEC, Frank and Harry went the same route as McMasters, approaching the media. But in their case, the big outlets wouldn't touch it, like the Wall Street Journal and the New York Times. No one would run with these stories. And that's because of one big difference. They didn't have someone like McMasters who was on the inside and who was willing to put his name to the accusations. It was really a going against the tide, because, again, with Ponzi, and I'm sure with Madoff, so many people were enthusiastic about what they perceived as their financial gains to be made. That's Faith Dickerson Again, William McMaster's granddaughter.
- [12:49]
Charles Ponzi
Yeah, I'm proud of him.
- [12:50]
Narrator
I remember when I would visit him.
- [12:52]
Charles Ponzi
He had a desk, and I still have that desk, and he had a.
- [12:56]
Narrator
Manual typewriter, and he would be typing away at his typewriter. So I could imagine him sitting there writing the Ponzi expose, from what I.
- [13:08]
Charles Ponzi
Had seen of him.
- [13:09]
Narrator
So how do you reflect on it as an adult now, knowing what you know? What do you make of this and his role in history?
- [13:18]
Charles Ponzi
It took a certain independence and, I guess, a risk.
- [13:22]
Narrator
I mean, his byline is there.
- [13:24]
Charles Ponzi
He was kind of written out of the story. Even the basic facts of it have.
- [13:28]
Narrator
Not been fully appreciated until efforts like yours. So I think he's finally getting his due, but that's taken a long time. It can certainly take a long time to get your due as a whistleblower. For Frank, it was about a decade until the global financial crisis of 2008. That's when Madoff's firm finally collapsed. But for years leading up to that, Frank had to watch as Madoff won awards and people continued to hand him their money. And even though Rumors were swirling around him. Madoff carried on unbothered. And no doubt that calm confidence helped keep things going, which is exactly what Ponzi did decades earlier. By the time Ponzi returned home on the day of McMaster's sensational expose, he actually felt like he was winning the public relations battle. He gave a long interview to the Boston Globe, the Post's main competitor, and they chose to print his rebuttal at length and seemingly unedited. It ran under the headline, ponzi Absolutely Denies Insolvency, Alleges Malice.
- [14:34]
Charles Ponzi
There is nothing but malice in this statement that Mr. McMasters and others have published. I feel that there's a deliberate attempt to prevent me by all means, from working for the benefit of the public in general should I be able to realize fully my dreams. Such a realization would mean the downfall of an autocratic regime which has been preying upon the credulity of people.
- [15:00]
Narrator
He even addressed his smile.
- [15:03]
Charles Ponzi
My smile, which has become so well known through cartoons and photographs, is prompted by a clear conscience. A run does not affect my serenity because I have the money to back it.
- [15:16]
Narrator
Clearly, he knew it was crucial that he remain calm and visible, which is why, like Madoff, he returned to his office again the next day, business as usual. He even joked around with reporters on the street that he ought to be getting a commission from the newspaper sales. There was still a line of people waiting to collect their money when he arrived, but it was shrinking much smaller than the day before. Ponzi was feeling confident that he could weather this storm like he had the other headlines a week earlier. And speaking of headlines, the Boston Globe even ran a particularly favorable one that evening. Ponzi investigators find nothing wrong. The actual story had a bit more nuance, but as Ponzi had discovered, people rarely read past the headlines. And this one seemed to be publicly absolving him. Which is why he not only decided to stay in the spotlight, he decided to seek it out, literally. Like when he took Rose and his mother to the theater.
- [16:14]
Charles Ponzi
Seems like half the town's here tonight. Rose, Carlo, non riesco.
- [16:18]
Narrator
Havedero il retro del palco.
- [16:20]
Charles Ponzi
Calmity. Comedy. Mama.
- [16:23]
Narrator
As was customary, the theater projected newsreel footage onto a screen before the show, since people didn't have television sets. Which is when Ponzi and his family were met with a familiar sight.
- [16:35]
Charles Ponzi
Oh, Rose, there's us from the other day. The newsreel footage shot at our house. Yes. Say cosi a triente, Carlo. I don't need to see this. I'm gonna use the powder room before the show starts. Hold on, darling. I hear the start of the show tonight is going to be extra special. What does that mean? Good evening. Good evening, ladies and gentlemen. It's an honor to be here with you tonight.
- [17:03]
Narrator
The headliner was Gentleman Jim Corbett, a former boxer who transformed himself into a traveling comedian. Ponzi surely appreciated someone with an eye for reinvention. And it appears that appreciation was mutual with Gentleman Jim inviting Ponzi on stage at the start of the show.
- [17:21]
Charles Ponzi
Well, well, if it isn't the wizard of finance right up there in the box seats. Charles, you're already stealing the show. You might as well come down here. I will, but it's the only thing I'll admit to stealing. Oh, Lord.
- [17:43]
Narrator
Gentleman Jim was in the middle the of of a residency, and Ponce had actually seen the show the night before. He'd met Jim in his dressing room, and the two quickly arranged for a short skit to open the show the next night.
- [17:55]
Charles Ponzi
What shall we do? Now that you're here, how about some boxing? I'll wear a blindfold to make it even. Yeah, and I'll tie one hand around my back. You know what? I got a better idea. I actually have a check here for $1 million. Whoa. Well, let me take that off your hands. Yoink.
- [18:22]
Narrator
Watching on as her husband pantomimed before a crowd, Rose must have wondered just what else she didn't know about her husband. I mean, given everything that had happened, everything that had been said about him, doubts must have crossed her mind. Although perhaps in that moment, she was more preoccupied with how much of a passenger she'd become in her life, someone being dragged, not entirely willingly, along the rollercoaster of Ponzi's success. All she had wanted to do was see a show, one of her favorite things, and think about something else for one night. But Ponzi just couldn't let that happen.
- [19:02]
Charles Ponzi
Magnifico, Carlo. Grazie. Mama. He's not as tall up close. Why'd I look next to him? I want to go. The show's just getting started.
- [19:14]
Narrator
Look around.
- [19:15]
Charles Ponzi
Everyone is staring at us. It'll calm down once the show starts. I have a bad feeling. I really think we should leave. Of course. Of course we can go. Come on. Mom. Rose, hold up. I got Mama. Charles, come on. It's him. He's out here. Leave us alone. He doesn't have your money. Here. I want to give him my money.
- [19:41]
Narrator
Take my money.
- [19:42]
Charles Ponzi
Please.
- [19:43]
Narrator
No.
- [19:43]
Charles Ponzi
Stop. Excuse me. I need to get Mama. Are you okay? Rose, I'M here.
- [19:52]
Narrator
I can't see you.
- [19:53]
Charles Ponzi
Just keep moving to the door. The driver should be waiting outside. Side. Pardon me. I need to get out.
- [20:00]
Narrator
And so, although Ponzi might have stemmed some of the losses at the office, the losses at home were coming to a head.
- [20:09]
Charles Ponzi
Take us home. Fast, please. Should have just paid Jim to do a private show. Clearly, things are getting a bit overheated in the city. And it's his summer, after all. I'll bring some security next time. I've hired some Pinkertons to guard the office. Maybe they could work off hours. There won't be a next time, Charlie. I am not going out in public with you again. It is too much. You don't want to go to the theater anymore? No, I very much want to go to the theater, but you ruined it. Can we not do this in front of Mama? Mama doesn't speak English, but she could tell me this is the one place where someone else is supposed to be in the spotlight and you just couldn't help yourself. You don't want to be seen with. I don't want the whole circus you bring. I have tried to be patient, but at this point, I just don't know what it's going to take for you to see the light. Gross. You can go to all the shows and the dinners and the interviews you want, but until things return to normal, and I mean normal, like a year ago. If you want to see me, you can see me at home.
- [21:14]
Narrator
Ponzi's appearance on stage was reported in the press, as were the lines outside his office, which kept up all week. Despite this, he remained solvent for now. But that would change eventually. One of those customers would get to the desk and find out that Ponzi was out of money. It's what the Boston Post was counting on. The final nail in the coffin. There wasn't much more they could do until Saturday, August 7, five days after McMaster's expose on the front page of the Post, when Ponzi suddenly vanished. His car remained parked outside his office, but there was no sign of him or his driver. He even skipped out on a scheduled press briefing. Friends, employees, even rose. No one knew where he was. All signs pointed to Ponzi having fled.
- [22:02]
Charles Ponzi
Extra. Extra.
- [22:03]
Narrator
Ponzi is missing.
- [22:04]
Charles Ponzi
Ponzi is missing.
- [22:08]
Narrator
Which led, inevitably to. To panic. The clock was running down on Ponzi. The government's audit was underway, and he was hoping for a miracle to get out of trouble. Although he was still smiling and his company still standing, he'd paid out over $3 million in total over the past week. That's $50 million today, leaving him in an extremely vulnerable position. And as for his other backup plan, the shipping company, he had dispatched someone to Washington to negotiate the purchase of the government's naval fleet. Records are murky about what happened, but it seems as though what little he had left wasn't enough money to make a suitable down payment. His long shot big idea was now dead in the water, leaving him about one defeat away from catastrophe. He'd be broke, and it wouldn't even matter what the audit said. Ponzi was not only running out of time, but moves, even if he couldn't see it yet. And on top of all that, he'd finally pushed his beloved rose too far. His marriage, it surely felt like, was now careening toward the rocks. In other words, this would be about the time that someone might decide to cut their losses. Even someone as bold and confident and optimistic as possible. Ponzi, that son of a.
- [23:33]
Charles Ponzi
That coward. He's fled.
- [23:36]
Narrator
Which is exactly what people suddenly suspected had happened when he disappeared that day. The headlines in that day's evening edition set off alarm throughout the city. It was a shock even to his doubters that he would just up and leave. Although there was one person tucked away in a rarely used office above the Hanover bank who was especially surprised by the panic.
- [23:59]
Charles Ponzi
What on earth? Excuse me. What's going on? He's done it. He's gone. Who's gone? What are you talking about? Charles Put. Oh, it's you. It said you fled. Oh, really? Really? Well, that's certainly quite the scoop. It's news to even me. Here, look. Hey, it's him. He's right here. I knew you wouldn't flee.
- [24:24]
Narrator
Oh.
- [24:25]
Charles Ponzi
Oh, you're stepping all over my. Step back. If you could disperse. Disperse, please. Clear the streets. Oh, it's you. Half the force is out looking for you. Oh, am I in trouble? People were worried. Boy, I don't know what you did to kick this panic off, but I'm sure you're in trouble with someone. Panic? I'm simply working out of my office and I lost track of time. Don't you think this is a bit of an overkill? Is everything all right? This is unbelievable. I mean, it's. It's madness. Can't a guy catch a break for an afternoon? How am I supposed to get anything done with all this going on? Maybe we'll escort you back to your office, Mr. Pony. Come along.
- [25:11]
Narrator
All that fuss simply because he was out of the public eye for Just seven hours. That's how crazy things had become for Ponzi. Which perhaps explains why he was becoming increasingly detached from reality. Otherwise, it surely would have dawned on him in that moment that the very thing Rose feared had come to pass. That Ponzi's fame had become too much. That it was inescapable, its own sort of prison. Fame may have helped him get to that point, but he was. He was learning what celebrities throughout time have. You don't get to be in the spotlight only when you want it. Ponzi was always on stage. He needed to be. Even as those around him saw the walls closing in, he had to make sure he was prepared. Which meant it was finally time to take care of a lingering problem. Well, well, if it isn't my esteemed business partner. A problem whose court order was still tying up a chunk of funds Ponzi would need very soon. A problem by the name of Joseph Daniels.
- [26:12]
Charles Ponzi
What? No hello here? What is this? Is this a settlement figure? Nope. Coakley Barker, Dwight Geraldson. That's a list of my lawyers. And if this goes to trial, that's who you're going up against. Or I could make it easy for you right now. 50,000. That's the settlement figure.
- [26:39]
Narrator
That's.
- [26:40]
Charles Ponzi
That's a lot less than a million. Tell you what. I'll agree to pretend we settled for 25. That way, you get to keep more of the money, and your lawyer gets stiffed on the commission. Fine. I accept. Splendid. We're settled. And we never have to speak again. Best of luck to you in your future endeavors. No hard feelings.
- [27:05]
Narrator
With that. Daniels and his lawsuit, the thing that had first attracted the attention of the Boston Post, were finally taken care of. But the Post had moved on to other, more troubling things for Ponzi.
- [27:19]
Charles Ponzi
Come in. Lucasula always comes through with the goods. First whiskey, now telegrams. Excellent. Though I take it they won't make for a happy read. No. Have you seen my umbrella? I could have sworn I left it here. It's perfectly sunny outside. Well, I know. I'm just getting all my stuff together so I don't have to come back. You're quitting? Well, I'm not sticking around to see how this plays out. And I suggest you don't either. I will. What's going on? Where's this coming from? Keep reading through the cards. That was a good umbrella. Ivory handle and everything. This one. The reporter from the Boston Post is on his way now and is expected to arrive. It's over.
- [28:03]
Narrator
And they know about Montreal Montreal, where Ponzi's criminal past had remained buried until now. Someone at the Post had caught wind that Boston's Charles Ponzi might also happen to be Montreal's Charles Bianchi, a man who'd been in prison for forging checks.
- [28:23]
Charles Ponzi
What do we do? Oh, now it's we, is it? Well, I didn't pick you for someone to give up so easily. Let's just say one man's giving up is another man's maintenance of freedom. And if you don't want to join me, I'd at least pay another visit to that priest and ask him to pray for a miracle. Ah, here's my umbrella. Good luck, Bianchi. Hope you're not expecting me to get too emotional. But who knows? Maybe we can do it all again someday somewhere else. I'll keep my eye out for you in the papers.
- [28:58]
Narrator
That's the end of Lucasulo. In our story and in all stories. In fact, in the aftermath of everything that happened, there was an effort by authorities to track Kosulo down, but they were unsuccessful. We spoke to one of his descendants, but even his family has no idea what happened to him after August 1920. The last that anyone reported seeing him was late one night when he broke into Ponzi's office and stole a bunch of cash before fleeing town. A fitting end to his story, at least. And with the Post on Ponzi's tale, Kasullo's theft was the least of his worries. The clock was ticking down even faster.
- [29:34]
Charles Ponzi
Now, in order to know for sure that Bianchi and I were one in the same, the Post would need to send a reporter up to Montreal and find a physical copy of my old mugshot. That would take a day, at least. Then the reporter would have to travel back to Boston, mugshot in hand, which meant that I had at least two days before all this got out.
- [29:58]
Narrator
But Ponzi had made a slight miscalculation. The Boston Post publisher was so excited about this finding, he didn't wait for a copy of the mugshot.
- [30:07]
Charles Ponzi
Montreal police, jail warden and others declared that Charles Ponzi of Boston was sentenced to two and a half years in jail for forgery on Italian bank. Ah, Christ.
- [30:20]
Narrator
Ponzi had never told Rose about being imprisoned in Montreal. Not when he was courting her, not when Cosulo showed up in town, and not even now. Ponzi, who was clearly so deep in denial, remained unwilling to concede any sort of defeat. So he took another familiar try to delay the inevitable. In this case, knowing that Rose had all but sworn off public life. He ordered his House staff to keep all copies of any newspapers away from the House. His plan, in other words, was to hope that. That Rose would be the last person in Boston to find out that he'd served time in prison. But his stalling tactics were on their last legs. All of his luck was turning against him all at once, starting with the government's investigation.
- [31:08]
Charles Ponzi
I've received the auditor's preliminary findings. His full report should be done by tomorrow. Can you come in for a meeting? I'll have to check my schedule. Well, it's like this. You can come in voluntarily for a meeting, or I can have some boys in uniform escort you. I guess it is like that. We've sent a copy to your lawyer. Confer with him and be at my office at noon. Yeah, well, I look forward to clearing.
- [31:33]
Narrator
All this up, obviously, and continuing with the Hanover Trust, which the Banking Commissioner was keeping a close eye on in anticipation of Ponzi soon running out of money. Everything was moving much faster than he'd expected. It was time for a last resort, his absolute, very last backup plan. A real Hail Mary, as they say. The one he'd put in place when he took over.
- [31:59]
Charles Ponzi
Hand over trust. Chmolinski. Hank, listen. Where have you been? Your account is overdrawn by hundreds of thousands of dollars. What the hell happened? Well, stop me if this is too technical for you, but you've withdrawn more than you deposited. What about the other account, the secret one? If I do that, then they're going to get you. Get us?
- [32:18]
Narrator
Who?
- [32:19]
Charles Ponzi
Who's they? The Banking Commission. They've been keeping track of our every move. Well, you have to. There's. There's no choice. And while you're at it, I need you to transfer the bank's reserves, all of them, into my account. Pink. Every time I think you said the most ridiculous thing, you go on top of yourself. Just for 24 hours. I'll swing by for a deposit slip, show the government my assets, pass the audit. Then we could transfer it all back. And did I mention the banking commissioners people are here right now in this building, going through the files. Well, then distract them. They're not Boston terriers. I'll give you a raise. Double the salary. A raise won't do me any good if this is my last day in the job, which it surely is, if I'm on the way down there now. We'll figure this out together.
- [33:08]
Narrator
But there was only more bad news awaiting him when he arrived.
- [33:15]
Charles Ponzi
Hank, there you are. Great timing. Hank, what are you doing? Where are you going? Make yourself useful. Would you just hold this? And try not to get it too wet. What's this? My personal effects. One moment, please. Stop. What are you doing? Can't close. I told you this would happen. I told you. Go back in there. We got work to do. That's an order. And over trust is no more. Which means, if nothing else, I don't have to entertain your nonsensical orders any longer. What do you mean? Where's the money? My money. Talk to the banking commissioner. It's his bank now. It's his money, too. Sophia, you don't mind, I'd like to get going. Hank, go home and see your wife while you still can. Talk to her. Go ahead. That's my best offer for you. A little wisdom. Hank. Hank.
- [34:17]
Narrator
The audit was done. Tomorrow he'd be shown a number, and he would have to prove that he had enough money to match it. And with the Hanover Trust closed down, he had no hope of doing so. He was out of moves and he knew it. So when he arrived home that night to find reporters camped outside his house, he wasn't able to muster his usual charming and optimistic self. Wasn't able to flash that smile that had gotten him out of so much trouble so far. Knowing what was coming for him tomorrow must have seemed pointless.
- [34:49]
Charles Ponzi
Ponzi, your mugshot's going to be on the front page tomorrow. Any comment? Hey, you know, they call me the man with the million dollar smile, and I do smile. But no one knows what I've been through in this fight, and I don't know if I have it in me. To.
- [35:11]
Narrator
Multiple government agencies, the press, McMasters, nervous investors. He'd outrun all of them for weeks. And perhaps he could have outsmarted and outlasted any one of them for a lot longer. But all of them at once? It was too much, even for Ponzi. There was, at long last, just one thing left to do. One person left to talk to.
- [35:33]
Charles Ponzi
Rose? Rose. Charles, what happened? Are you okay? Rose, listen to me. I. What is it? We need to talk.
- [36:04]
Narrator
Next time on Easy Money.
- [36:06]
Charles Ponzi
I'm not quite the man you think I am. Rose, apparently you're being arrested with a Ponzi scheme. By kind of its definition, there is.
- [36:13]
Narrator
No way to get out of it.
- [36:14]
Charles Ponzi
Those are the auditor's findings. Do we have a problem? I asked you to put this auditor on my books. Does that sound like a criminal to you?
- [36:23]
Narrator
This is what's so interesting about the Ponzi mentality. You don't actually see the victims. It allows you to deflect and diffuse what you're doing. I have lost many nights of sleep. There's no doubt it's affected my personal personality.
- [36:37]
Charles Ponzi
I am innocent and I intend to prove it in the court of law. We assume trustworthiness until proven otherwise, and that makes us sitting ducks for people who just deliberately earn our trust in.
- [36:50]
Narrator
Order to rip us off. Isn't our future the most important thing?
- [36:54]
Charles Ponzi
It's never too late. We'll figure it out, okay?
- [37:16]
Narrator
Easy money. The Charles Ponzi Story is an Apple Original Podcast produced by At Will Media, reported and hosted by me, Maya Lau. Our producers are Matt Hickey and Brigand Snow. Production center support from Ann Margaret Warner, Lee Mingistu and Taylor Hosking. The show is written by Matt Hickey and Kevin Hines with additional writing from Maya Lau and Brigand Snow. Our audio editor is Andrew Holtzberger with support from Greg Devens II and Zach Grapone. Field recordings by George Hicks. Original music is by John Naichez. Sound design and mix engineering by Sound and Fission. Scripted scenes directed by Katie Finneran. Casting for scripted scenes by Darrell Eisenberg. CSA fact checking by Sona Avakian. Ashley Taylor is our senior supervising producer. Executive producers are Will Malnati and Sebastian Maniscalco. Our co executive producer is Kevin Hines. The part of Charles Ponzi is played by Sebastian Maniscalco. Rose Ponzi by Candice Shedd Thompson, William Mcmasters by Darren Goldstein, Lucasulo by John Littlefield, Henry Schmielinsky by Richard Fisk, Joseph Daniels by Watt White, Imelda Ponzi by Danielle Tarmi and Gentleman Jim by Nathan Vincenti. Additional parts played by Brennan Lowry, Joe Hubbard, Jordan Demario, Marika, Aubrey Martin Cohen, Paul Kevins, PJ Serino, Cheve Brown, Tyler Haynes and Wyatt Daniel Logan. Legal services providers provided by Sean Gordon with Weintraub Tobin and Carolyn Levin at mksr. Follow and listen on Apple Podcasts.