Anatomy of a Ponzi scheme

Located at a stone’s throw from the public beach in Clifton, the offices of For U Real Traders Ltd appeared swarmed with prospective clients looking to double their savings in a short time. Beyond the reception area adorned with a portrait of the Quaid-i-Azam and many works of Islamic calligraphy was a bullpen where a large team of 20-something women worked the phone lines non-stop. Next to it was the meeting room where a “sale manager” would pitch the get-rich-quick scheme to the clients who showed serious interest in the first few phone calls. “If you deposit Rs100,000 today, you’ll get eight to 10 per cent profit every month. You can withdraw the initial Rs100,000 a year later or reinvest it,” I was told. In simpler words, the “investment scheme” promises a nominal rate of profit that ranges from 96pc to 120pc a year. For context, the annual profit rate on a typical savings account offered by conventional banks is hovering around 22pc these days. The apparently Ponzi scheme is elaborate in the sense that there’s a ready answer to every obvious question.