Digital currencies are becoming a common payment method among consumers worldwide. Bitcoin and other cryptocurrencies are quickly expanding its reach as people are increasingly trusting them to make payments, transfer money and even save it. Yet, volatility and security remain two important asp ects that people cannot ignore when considering cryptocurrencies. The introduction of so-called stablecoins […] Facebook Twitter Telegram Linkedin 10 Ways To Hack A Bitcoin Wallet In 2020 Digital currencies are becoming a common payment method among consumers worldwide. Bitcoin and other cryptocurrencies are quickly expanding its reach as people are increasingly trusting them to make payments, transfer money and even save it. Yet, volatility and security remain two important aspects that people cannot ignore when considering cryptocurrencies. The introduction of so-called stablecoins has mitigated the risks for volatility, offering digital currencies pegged to stable fiat money, like the dolla...
The classic Ponzi scheme is one of the oldest tricks in the book. But that hasn’t stopped it from being widely successful throughout history!
With a Ponzi scheme, you promise investors out-sized returns. But instead of actually earning those returns, you just pay out profits using funds from newer investors.
While investors think the returns are from incredible product sales, your brilliant investing decisions, or some other means, the perpetrator of the Ponzi Scheme is literally just robbing Peter to pay Paul.
The scheme was named after the conman Charles Ponzi, who in the 1920s, promised U.S. investors a 50% profit within 45 days by investing in postage stamps. (Or for the patient, a 100% profit in 90 days!)
His scheme was so wildly successful that he even got a front page feature on The Boston Globe, resulting in thousands of new investors lining up outside his office, ready to give Ponzi their money.
At its peak, Ponzi’s scheme was earning him over $250,000 a day (about $3 million in today’s dollars) and Charles Ponzi lived a lifestyle of big mansions, fancy cars, and first-class ocean liner tickets.
However, there’s just one problem with Ponzi schemes – they’re pretty much doomed to failure.
A few months later, Ponzi’s con came crashing down when people finally did the math and realized his investment strategy was impossible. This lead to another front page newspaper story. Except this time, it was about his history of fraud in Canada. Knowing he was about to be arrested, Ponzi turned himself in.
All told, Ponzi stole $20 million from his fraud – nearly $200 million in today’s dollars.
Not to be outdone, American investor Bernie Madoff resurrected the Ponzi scheme in the early 2000s. He did a good job, too! Madoff is the current Ponzi Scheme champ, a title that also gives him the infamous title as the perpetrator of the largest financial fraud in world history.
From 1960 to 2008, Madoff ran a well-respected wealth management company and was widely considered one of Wall Street’s best investors. So much so, that he raised $36 billion from many of the world’s wealthiest and most famous people.
There was just one problem…
Madoff wasn’t actually earning those amazing returns. He was just writing them down on paper and then hoping his house of cards never fell.
Unfortunately, Madoff’s con came crashing down in 2008. With the stock market falling, Madoff’s investors began panicking and asking to withdraw their money from the fund in unprecedented volumes. But since Ponzi schemes rely on a steady stream of new investors, Madoff quickly found himself $100 million short…
He was arrested in December 2008 and sentenced to 150 years in prison. Total estimated cost of his fraud? $64.8 billion dollars.
2. Rob a bank.
Is there a more cliche way to get rich illegally than pulling off a bank heist?
Probably not. Which is why this strategy has wielded some of the wildest and craziest true stories ever.
There’s the 2006 classic Securitas Depot Robbery, where a British team of 6+ robbers (including former UFC fighter, Lee Murray) impersonated a police officer, kidnapped the depot manager and his family at gunpoint, and forced him to open the vaults.
That team made off with $92 million in cash – so much that they literally spent hours loading it onto multiple trucks. To this day, it’s still the largest bank heist ever. (Topped only by a strange technicality, when Saddam Hussein pulled some political strings to rob the Central Bank of Iraq of nearly $1 billion dollars. But that’s cheating.)
They almost got away with it too. Despite the world knowing he was guilty, Lee Murray fled to Morocco, where he spent months living it up in a million dollar mansion and golden Mercedes-Benz, thanks to a strange extradition policy between the U.K. and Morocco at the time. Eventually though, Murray was arrested, and he’s currently serving 25 years in a Moroccan prison.
Then there’s the Banco Central Burglary in Brazil. There, a 25 member gang created a fake landscaping businesses, bought property next to the bank, and spent three months digging a 300 foot underground tunnel leading underneath the bank vault’s floor. Then, over the weekend, the team poked a hole in the floor and ran off with $72 million dollars.
($50 million was never recovered, and many team members were never arrested.)
His master plan? He’d walk into banks, armed with nothing more than a hand written note, and ask the teller for all their cash. Afterwards, he’d grab something to eat from Chili’s.
In his own words:
Q: What did you say to the teller?
A: Walked in the bank and waited in line like a regular customer. Whichever teller was available to help me is the one I robbed. I simply walked up to them when it was my turn to be helped, and I told them — usually via handwritten instructions on an envelope — to give me their $50s and $100s. There was no threat. I just told them what I wanted, and they complied. This is how it works in America because the amount of money a bank gives up ($5-$7k on average) per bank robbery is infinitely less than the amount of business they’d lose if sh*t got wild in a bank full of customers.
Q: Where did you go after your escape?
A: I usually went to Chili’s or somewhere to eat and chill out.”
3. Sell illegal counterfeit goods.
According to Forbes, counterfeiting is now the largest criminal enterprise in the world.
Anyone who’s ever spent time in New York City’s Chinatown knows that selling knock-off handbags, cologne, and fashion accessories is big business.
The most counterfeited brands? Rayban, Rolex, Supreme, Louis Vitton, and Nike according to the OECED, an anti-counterfeiting organization.
But criminals don’t limit their counterfeiting to just fashion. Ripping off electronics, toys, and cigarettes are also big money makers. Plus, the most dangerous counterfeit category of them all – pharmaceutical drugs.
(Most of the pill overdoses you hear about, including high profile cases like the deaths of Prince and Heath Ledger, can be traced back to counterfeit opioids.)
Whether it’s a drug or a sneaker, if it’s got a brand, somebody’s probably trying to copy it.
By far though, my favorite counterfeit good story is the dude from Netflix’s Sour Grapes documentary. Rudy Kurniawan was a wine connoisseur known for his impeccable palate. Supposedly, he could taste nearly any wine and immediately identify not only the type, but the exact maker and region of the wine.
Unfortunately, ‘ole Rudy ended up using that golden palate of his for evil. When the FBI raided his home in 2012, they discovered he’d been strategically mixing common wines in recipe-like proportions, until his cheap concoctions were able to fool even the world’s most premier sommeliers into believing they were drinking rare, expensive burgundy.
(Hey, you gotta respect a guy that can make 2 buck chuck taste good!)
He then relabeled his cheap homemade blends with the stickers from prestigious winemakers, before selling them at auction for millions of dollars.
Rudy soaked the labels off thousands of wines, Catch Me If You Can style.
All told, it’s estimated his counterfeit wines sold for nearly $50 million dollars. To this day, there may be as many as 10,000 of his counterfeit bottles still in private collections.
4. Become a drug dealer.
Cocaine Kingpin Pablo Escobar once had so much money that instead of turning on the heater, he burned $2 million in cash.
I guess that’s what you can do when you’re supplying 80% of the world’s cocaine – an accomplishment that earned him $420 million a week during his cartel’s peak. (And had him spending $1,000 per week on… rubber bands for all that cash.)
In fact, Escobar’s insane earnings actually led to his downfall, because he was bringing in so much cash that he literally couldn’t launder the money fast enough. Instead, he resorted to storing cash in old warehouses, inside the walls of his houses, and even in empty farm fields.
Not ideal. Which is probably why his accountant budgeted a staggering $2.1 billion a year in ruined cash, usually from water damage, mold, or rats eating the bills.
5. Play the lines like an illegal sports gambler.
While most gambling has a reputation for degenerate losers, sports betting holds an interesting subset of big time “whales” who’ve had so much success in the industry, they’re known to move the odds of a game by themselves.
Some famous gamblers, like Billy Walters, made a name for themselves by being one of the first gamblers to use computer analysis to help his sports predictions. The result was a 30-year winning streak that earned Billy millions of dollars, and eventually got him banned from Las Vegas casinos.
Other sports gamblers take a less glamorous approach.
One of the most common strategies is to utilize arbitrage. That is, gamblers will look for less popular games or events and try to find discrepancies in the odds at various casinos.
A minor league baseball game? Perfect. A horse race nobody’s ever heard of before? Even better.
By laying strategically hedged bets at different casinos, a clever gambler can virtually guarantee a profit in certain instances.
Easier said than done, for sure.
Interesting, this only becomes an illegal side hustle if you’re placing your bets in a state where sports gambling is outlawed.
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