- *risk investment system based on small, initial sums of *money Pyramid schemes are often *fraudulent. They function like chain letters, depending on ever-increasing numbers of money-paying participants to join the scheme: Investors are promised high *returns, and the *cash flow to pay the returns is dependent on the new investors’ contributions. When the pool of new investors eventually dries up, the system collapses under the weight of its own mathematics, and participants can lose all or part of their investment. In Albania in the 1990s, a series of large-scale pyramid schemes robbed thousands of people of their life savings, causing serious street unrest and a political crisis.
Auditor's dictionary. 2014.
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pyramid scheme — Pyramid Pyr a*mid, n. [L. pyramis, idis, fr. Gr. ?, ?, of Egyptian origin: cf. F. pyramide.] [1913 Webster] 1. A solid body standing on a triangular, square, or polygonal base, and terminating in a point at the top; especially, a structure or… … The Collaborative International Dictionary of English
pyramid scheme — n. A sales scheme, often illegal, in which a buyer of goods is promised a commission for every additional buyer he or she finds and recruits to be a seller, and in which the people at the top of the pyramid collect payments from all the bottom… … Law dictionary
pyramid scheme — pyramid .scheme also Pon|zi scheme [ˈpɔnzi ski:m US ˈpa:n ] n a dishonest and often illegal way of selling ↑investments, in which money from people who ↑invest later is used to pay people in the system who have already invested … Dictionary of contemporary English
pyramid scheme — n. a moneymaking scheme in which revenues are derived chiefly by recruiting increasingly larger groups of new salespeople or investors, each of whom pays for the right to recruit others in turn … English World dictionary
Pyramid scheme — The unsustainable exponential progression of a classic pyramid scheme A pyramid scheme is a non sustainable business model that involves promising participants payment or services, primarily for enrolling other people into the scheme, rather than … Wikipedia
Pyramid scheme — An illegal, fraudulent scheme in which a con artist contrives victims to invest by promising an extraordinary return but simply uses newly invested funds to pay off any investors who insist on terminating their investment. The New York Times… … Financial and business terms
pyramid scheme — An illegal, fraudulent scheme in which a con artist convinces victims to invest by promising an extraordinary return but instead simply uses newly invested funds to pay off any investors who insist on terminating their investment. Bloomberg… … Financial and business terms
Pyramid Scheme — An illegal investment scam based on a hierarchical setup. New recruits make up the base of the pyramid and provide the funding, or so called returns, given to the earlier investors/recruits above them. A pyramid scheme is initiated by an… … Investment dictionary
pyramid scheme — pyramid (def. 8). * * * … Universalium
pyramid scheme — noun An illicit money making investment scheme whereby early investors are paid primarily or wholly by later investors. Eventually all such schemes fail to the detriment of recent (later) investors. Syn: pyramid selling scheme … Wiktionary