The Hallmarks of a Ponzi SchemeThe mechanics described by prosecutors closely match the classic characteristics of a Ponzi scheme. Instead of generating investment returns from legitimate business activity, the operation relied on incoming investments to satisfy withdrawal requests and promised monthly payments. FinanceFeeds has covered numerous enforcement actions involving forex investment fraud, many of which relied on nearly identical claims of proprietary trading systems producing unusually stable profits. The CFO Was Not Treated as a Passive EmployeeThe prosecution demonstrates that financial executives cannot avoid liability simply because they are not the founders of an investment scheme. Recent federal prosecutions involving investment fraud similarly demonstrate prosecutors’ willingness to pursue multiple participants who contributed to the operation or concealment of fraudulent investment schemes.