How The Greatest Scam Artist In History Is Still Being Felt Today

When you have an actual crime named after you, you know you’ve made it into the “Criminal Hall of Fame.” Such is the case of Charles Ponzi, the Italian-born immigrant who traveled to Boston at the turn of the century in order to revitalize his family’s disgraced reputation. On the outside, his story mirrors that of many immigrants: He dreamed of making something of himself in America, the land of opportunity. 

Peel back the layers, though, and you’ll see how unique Ponzi’s story really is. Not just anyone could have pulled off the scheme of the century, but it’s safe to say that no one expected a poor Italian immigrant with nothing but charm to end up in the history books…

When Ponzi first saw the city of Boston come into view in 1903, all he had was $2.50 and hope that, in America, he’d make his fortune. He had gambled most of his money away, but as he said himself, he had “$1 million in hopes.”

A newcomer with almost no money to his name, Charles Ponzi was the kind of Italian immigrant Americans came to expect: He was charismatic despite his dire financial straits, and with unbelievable confidence despite being in a strange city surrounded by strange people.

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But after a few fruitless years in Boston, he moved to Montreal, where he finally had some luck. He got a job as a bank teller at Bank Zarossi. Unfortunately, the bank charged high interest rates to unsuspecting Italian immigrants, and eventually went bankrupt.

This left Ponzi in a bad spot. He needed money and fast, so he tried his hand at a little deception…which didn’t end well for the novice crook. He was caught forging a bad check and was sentenced to three years in a Quebec prison.

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After his time in prison, Ponzi reevaluated his life. He’d spent five out of approximately 15 years in the U.S. and Canada as a prisoner for various crimes. Instead of having a sobering effect, however, these thoughts only reinforced his lifelong goal.

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Ponzi didn’t know how he was going to make his fortune. He just knew he wasn’t going to abandon his life of crime, the only path that had ever led him to any kind of financial success, however brief. So, he returned to Boston.

When he got that fateful letter in the mail from a company in Spain, he knew the right opportunity had finally arrived. Inside the letter was an IRC, or an international reply coupon, which could be exchanged for more expensive airmail postage stamps from another country.

Believe it or not, when Ponzi saw the IRC, he saw dollar signs along with it. He realized that if he bought IRCs in one country, he could exchange them for more expensive stamps in another country…and turn a hefty profit in the process.

Looney Tunes/Warner Bros.

If it sounds easier said than done, that’s because it was. But Ponzi was banking on the scheme being complicated. A little confusion here, some misdirection there — Ponzi’s plan had to be difficult to crack in order for it to work in his favor.

Luckily, his years of shady business dealings had left him with more than just a rap sheet. Ponzi had developed a network of cohorts who would help him bring his money-making scheme to life. With their help, his vague idea turned into a full-blown business.

Ponzi sent money to people working for him in other countries, and they would purchase IRCs and send them back to Ponzi. He would then exchange the IRCs for stamps worth more than he paid for them, and sell the stamps for a profit.

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And the profit was often astronomically higher than he had ever expected. He reportedly garnered more than 400% on these sales, a baffling enough number to make even the most money-hungry crook take the cash and run. But Ponzi wasn’t your average crook.

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Many conmen knew when not to push their luck, but Ponzi wasn’t one to rest on his laurels. With every profit he saw only more opportunity, so he did the most risky thing a crook can do: He brought his underground scheme up to the surface.

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Ponzi began to seek investors in order to turn even higher profits. With every deal, though, Ponzi couldn’t help but make alarmingly confident promises: “You’ll see returns of 50% in 45 days,” he’d tell investors, with seemingly no worry about how he would deliver.

Catch Me If You Can/DreamWorks Pictures

As his promises became more unbelievable (“100% returns in 90 days!”), Ponzi did the impossible: He delivered. No one knew then just how he was able to fulfill his fairy-tale promises to investors, and the truth itself was hard to believe.

In a move that was later mirrored by Bernie Madoff, Ponzi paid his investors not with his own substantial wealth, but with each other’s wealth. He paid each investor with the money from other investors, all the while leaving his own profits untouched.

Catch Me If You Can/DreamWorks Pictures

Gone were the days where Ponzi lived off of his own charm; by 1920, Ponzi had a mansion and reportedly raked in $250,000 a day. Over time, however, the center of his scheme started to shake, and Ponzi made a startling realization.  

Colonial Times Magazine

Ponzi realized, perhaps for the first time, that confidence couldn’t make money materialize out of thin air. Sure, he was cycling the investors’ money, but how long could that last for? His debts were starting to climb while the investors’ patience were starting to wear. 

I Wake Up Screaming/20th Century Fox

To make matters worse for Ponzi, it wasn’t like his quick rise from poverty to millionaire status didn’t go unnoticed. Being written about in the papers made him uneasy, and for good reason: In 1920, The Boston Post started to investigate his immense wealth.

The Post had a financial journalist examine Ponzi’s scheme, and the journalist made some shady discoveries: Not only was the scheme impossible to pull off, he concluded, but there was no way Ponzi was paying his investors with his own money.

Catch Me If You Can/DreamWorks Pictures

After The Post’s allegations, Ponzi’s scheme was thrown into chaos. An angry crowd formed outside his office, and in three days time he had dispersed $2 million among them. He knew he was in a tight spot, so he did the only thing he could do.

He mollified the crowd with soothing assurances, all the while passing out coffee and doughnuts. Much of the crowd ended up leaving their money with Ponzi, their trust regained. Unfortunately, one observer wasn’t so quick to forgive.

Of all the people Ponzi had successfully dodged during his scheme, Daniel Gallagher, the District Attorney for Massachusetts, wasn’t so easily fooled. He ordered that Ponzi be audited, a decision that landed Ponzi in uncomfortably hot water.

On August 11th, 1920, The Post published an incendiary front-page article that ended up being the nail in Ponzi’s scandal-ridden coffin. The article exposed everything, from Ponzi’s mail fraud to his forgery conviction to his involvement in Bank Zarossi’s downfall years before.

The Boston Post

With that, Ponzi was charged with 86 counts of mail fraud. He owed an estimated $7 million and would have faced life in prison if his wife hadn’t convinced him to plead guilty. The most incredible part of Ponzi’s story, though, isn’t his legendary scheme.

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What’s incredible is how, during his 14 years in prison, Ponzi still received Christmas cards from investors who hoped he could help them turn a quick profit from his cell. Even today, Ponzi’s legendary scheme continues to inspire…and not always in a good way.

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The way Jerry Jacobson pulled off the defining heist of the ’90s goes all the way back to his early career. Ironically, he started out as a police officer. He’d dreamed of busting bad guys and upholding justice since he was a kid.

But his dream was shattered shortly after becoming a cop, when an injury forced him to find work elsewhere. He found himself injured, out of the job, and totally directionless…until he heard of a gig that seemed like the perfect fit. 

CMOA Collection-Carnegie Museum of Art

He started working as a security auditor at Dittler Brothers, a speciality printing company. Slowly but surely, he worked his way up to a coveted position at Simon Worldwide, one that many people were vying for: Supervisor of the McDonald’s Monopoly tickets, or “pieces.” 

Jerry certainly seemed like a motivated guy, but those who worked with him used a different word to describe him: intense. “He inspected workers’ shoes to check they weren’t stealing McDonald’s game pieces,” one of his co-workers said.  

The Irishman/Netflix

Keeping such a watchful eye over his employees made Jerry seem like the ideal security officer. He was shrewd, clever, and observant, three qualities that make for a great leader…and for a great con artist.

All The President’s Men/Warner Bros.

It’s hard to say what made Jerry — “Uncle Jerry,” as he was nicknamed later on — steal that first winning Monopoly ticket. Some believe that a recent Guillain-Barré diagnosis made him desperate for control. 

For whatever reason, Jerry did steal that Monopoly ticket. He knew he couldn’t get too greedy, since doing so could threaten the entire operation. He had to test the waters, so he did a trial-run.

This “trial run” was actually worth a quarter of a million dollars. Jerry stole the $25,000 piece in 1989, but instead of pocketing it for himself, he quickly passed it off to the person he wanted to impress the most.

Katy Warner/Wikimedia Commons

His own brother. “I don’t know if I just wanted to show him I could do something,” Jerry later said. Whatever the reason, his brother was $25,000 richer, and Jerry was convinced that his little scheme just may be a diabolical success. 

Disney

He started to feel around for business opportunities, and he soon found them by stealing and redistributing the $10,000 winning tickets to those who were willing to pay the price. He got away with it again and again…until McDonalds made a startling announcement. 

They had picked up incidents of insider theft within the company and were tightening security of the McDonald’s Monopoly Sweepstakes as a result. The stranglehold that Jerry had on the entire operation was slipping.

Sean Jason Webb / Twitter

In the mid-90s, Jerry was re-given the responsibility of overseeing the distribution of promotional Monopoly pieces. This was his chance to pick up where he left off, but this time around, Jerry noticed something about the sweepstakes that made his skin crawl.

He realized that Simon Worldwide wasn’t printing winning pieces in Canada despite advertising otherwise. This meant that Canadians were buying McDonald’s products in hopes of winning prizes that didn’t exist. Ironically, this deceit struck a chord with Jerry.

“I knew what we were doing in Canada was wrong,” Jerry later said. “Somebody was going to be asking questions about why there were no winners in Canada.” The lies, the deceit, the phony marketing…who would do such a thing?

It didn’t take long for Jerry to answer that question himself. He would do such a thing, and when by some twist of fate he accidentally received a set of anti-tamper seals for the winning pieces, he already had a plan in mind.

This meant reviving the scheme, and he did so with more determination than ever before. He established contacts with people who wanted “in” on the scam, but it wasn’t until later that Jerry met someone who took his plans to new heights. 

You expect a con artist to have a colorful group of co-conspirators, and there was no one more colorful than Gennaro Colombo. A chance encounter led to them joining forces, and Jerry soon learned what it meant to have Gennaro on your team.

Hasbro

Gennaro Colombo was a nightclub owner and underground gambling ring operator, but he had more to hide than seedy business deals. Gennaro was a member of the Colombo crime family, and it was this connection that made Jerry’s network of co-conspirators explode.

Gennaro allegedly introduced Jerry to “mobsters, psychics, strip club owners, convicts, drug traffickers, and even a family of Mormons,” many of whom eventually “won” almost every McDonald’s Monopoly prize for 12 years. 

And with every new contact, Jerry had a payday himself. If you wanted to win an instant prize, you had to pay Jerry a portion of the winnings up front. If you wanted the $1 million prize, you gave Jerry a $50,000 cash installment.

HBO

Gennaro benefitted from the collaboration by “winning” a Dodge Viper, and he even had the nerve to star in a McDonald’s commercial promoting the sweepstakes. Jerry scammed McDonald’s out of millions of dollars, and for 12 years, no one suspected a thing…

McDonald’s Monopoly Sweepstakes

But there was a catch: many of the “winners” were regretful people who found themselves wrapped up in Jerry’s shady plan. It wasn’t until an anonymous tipster contacted the FBI that anyone saw any red flags.

Immediately, the FBI launched operation “Final Answer” with the aim of uncovering the McDonald’s Sweepstakes conspiracy. When the agents tapped Jerry’s phone, they learned the most disturbing detail yet. 

HBO

The scam was far more widespread than they originally knew. They’d have to work quickly and quietly in order to remain undetected, especially since the vast network of conspirators flew under the radar with ease. 

HBO

So the FBI posed as a news crew in order to sneakily interview the most recent $1 million winner, Michael Hoover. They went to Hoover’s home, and what they noticed during this interview only made them more suspicious.

Michael Hoover was visibly nervous during the interview. The FBI knew his fear was a sign that something illegal was going on; all they had to do was catch the conspirators in the act. How? The FBI had to lay down with the dogs…

McDonald’s Monopoly Sweepstakes

In 2001, McDonald’s launched another Monopoly game, but with one big difference: Jerry and his entire known crew were put under surveillance. It didn’t take long for the FBI to gather the evidence they needed in order to spring to action. 

So on August 22, Jerry’s slumber was interrupted by police, who charged him with conspiracy to commit mail fraud. His entire network was hauled in for sentencing, and the top conspirators were imprisoned for a year. But what about Jerry’s sentencing?

1936 Parker Brothers/Monopoly

Jerry received the most tragic lucky break in the day of his trial: September 10, 2001. Many believe that the case isn’t known nowadays because of this fateful coincidence — not that Jerry escaped punishment, however.

After stealing $24 million from McDonald’s, Jerry awaited sentencing for his crimes. There was no doubt that he was guilty, but still Jerry tried to lessen the blow by telling the court something he did years before, back in 1995.

In 1995, St. Jude Children’s Hospital was mailed a winning McDonald’s Monopoly game piece worth $1 million, which McDonald’s ended up honoring. Jerry hoped this brief moment of philanthropy would make him appear more sympathetic.

St. Jude Children’s Research Hospital

That’s when Jerry knew that, finally, the jig was up. He signed a confession and was sent to prison for 15 years. To this day, though, Jerry hasn’t totally left his old life of crime behind.

Gennaro died in 1998 in a car accident, but Jerry still gets calls from former conspirators like Andrew Glomb. “I always tease him. I say, ‘You got any tickets?’” Glomb jokes. But for most people, Jerry’s crimes are no laughing matter. 

After Jerry’s arrest, former Deputy Attorney General Jeffrey Harris could only think about the people who wasted time and money on a prize they’d never win. “People that were buying the hamburgers, all they were getting at this point was cholesterol,” he said. 

The McDonald’s Monopoly scam is now an HBO docuseries, proving once and for all that every crime — from small-time theft to a decades-long heist — can’t fly under the radar forever. Nowadays, “Uncle Jerry” lives alone…barely able to afford a hamburger.

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