Ponzi's Scheme (36 page)

128

the Supreme Court took: Leonard Levy,
Emergence of a Free Press,
Oxford University Press, 1985.

128

“protect a man in falsely”:
Schenck v. United States,
249 U.S. 47 (1919).

129

one that would take a heavy toll: The story of Curley's feud with Edwin Grozier and the
Post
is told in Kenny, pp. 165–75 and in Beatty, p. 414. Valuable information also came from a March 7, 2003, interview with Mary Grozier.

131

Louis and Charlotte Blass: “Ponzi Winners Include Coupon Wizard's Wife,”
Boston Traveler,
August 24, 1920, p. 1; “Two Witnesses Sought in Ponzi Case Disappear,”
Boston Herald,
September 12, 1920, p. 1; “Sued for $90,000 by Ponzi Trustee,”
Boston Globe,
March 8, 1925; “Blass Denies He Was an Agent for Ponzi,”
Boston Globe,
November 9, 1920; 1920 U.S. Census records.

132

Henry Neilson: “Many Attend Ponzi Hearings,”
Boston Traveler,
August 19, 1920, p. 1; “To Quiz Other ‘Stars' of Ponzi Sales Force,”
Boston Traveler,
September 17, 1920; “Reported Investor Denies Depositing with Ponzi,”
Boston Herald,
August 24, 1920, p. 8; “Neilsen [sic], Ponzi Agent, a Witness Today,”
Boston Globe,
September 17, 1920, p. 1.

133

Charles Ritucci, who ran the Plymouth office: “South Shore Invests in Ponzi's Coupon Scheme,”
Boston American,
July 31, 1920, p. 2.

133

the North End branch:
Cunningham v. Commissioner of Banks,
144 N.E. 447; “History of Hanover Trust Company and Ponzi,”
Boston Evening Globe,
August 31, 1920, p. 1.

133

index-card system: “Ponzi to Be Called in Federal Hearing,”
Boston Globe,
September 22, 1920.

134

In May alone, 1,525 investors: Monthly investment totals come from the federal audit that led to the closure of the Securities Exchange Company and were evidence at Ponzi's 1922 trial. “How The Bubble Grew,”
Boston Evening Transcript,
November 6, 1922, p. 24.

134

“A little dollar could start on a journey”: Ponzi, p. 93.

134

If flight or surrender crossed his mind: Only much later would he recognize his hubris, writing of this time period, “But I lacked judgment and caution. I thought I'd reach for more. It was there in plain sight. I did not look beyond it. If I did, I did not see. I must have been blinded by ambition and conceit.” Ibid., p. 89.

134

“The average man is never satisfied”: Ibid., p. 89.

134

Gneccos and the Donderos had poured: List of Unsecured Creditors, in Summary of Debts and Assets of Charles Ponzi in Bankruptcy, Schedule A, Case 28063, on file at the National Archives and Records Administration in Waltham, Massachusetts.

135

a tentative step toward flight: Nancy Wrynne, “Ponzi's Home Life Is Simple and Devoid of Ostentation,”
Boston Sunday Herald,
August 1, 1920.

135

“What was I going to do?”: Ponzi, p. 109.

135

He consoled himself with a story: Ibid., p. 114.

136

a vacant house on Slocum Road: Details of the house come in part from a June 3, 2003, tour of the home and property records found at Lexington Town Hall. The amount and method of Ponzi's purchase of the house was long subject to dispute, but the figure of thirty-nine thousand dollars was ultimately deemed most credible by the bankruptcy trustees. For purchase and decoration details, see “Understood He Paid $29,000 for Home,”
Boston Globe,
January 7, 1925, p. 1; “
Post
Prints Ponzi List of Investors,”
Boston Post,
August 23, 1920, p. 1; “Well-Known Men Got Big Hauls from Ponzi,”
Boston Post,
August 25, 1920, p. 1;, “ ‘Charlie's a Born Aristocrat,' Says Mrs. Rose Ponzi,”
Boston Post,
December 3, 1922, Special Feature Section, p. 1; “Ponzi Won't Admit Giving Note for Home,”
Boston Globe,
June 9, 1921; “Dispose of Ponzi Mansion,”
New York Times,
June 10, 1921, p. 24; “His Pretty Girl Wife Sorry When Ponzi Quit $50 Job,”
Boston Globe,
August 8, 1920, p. 8; and Nancy Wrynne, “Ponzi's Home Life Is Simple and Devoid of Ostentation,”
Boston Sunday Herald,
August 1, 1920.

138

Ponzi received his first notice: “Dear Old ‘Get Rich Quick' Pops out of Postal Guide,”
Boston Traveler,
June 9, 1920, p. 1.

139

Ponzi mollified Cassullo: “Swell Ponzi's Assets $15,500,”
Boston Post,
September 6, 1920, p. 18; “Two Witnesses Sought in Ponzi Case Disappear,”
Boston Herald,
September 12, 1920, p. 1; “Ponzi, Defiant, Balks Efforts of Receivers,”
Boston Post,
August 23, 1920, p. 1; “Sale of Home Ponzi Bought Restrained,”
Boston Globe,
September 7, 1920.

139

Cassullo was not satisfied: “Says Three-Fourths of Police Ponzi Investors,”
Boston Globe,
November 22, 1922.

140

June was on track: Monthly investment totals come from the federal audit that led to the closure of the Securities Exchange Company and were evidence at Ponzi's 1922 trial. “How the Bubble Grew,”
Boston Evening Transcript,
November 6, 1922, p. 24.

140

Daniel Desmond: “Desmond Resigns from Lawrence Trust Company,”
Boston Globe,
August 24, 1920, p. 8; “Grill Ponzi Again Today,”
Boston Post,
August 24, 1920.

140

Blasses spun the wheel of fortune: “Ponzi Winners Include Coupon Wizard's Wife,”
Boston Traveler,
August 24, 1920, p. 1; “Two Witnesses Sought in Ponzi Case Disappear,”
Boston Herald,
September 12, 1920, p. 1; “Sued for $90,000 by Ponzi Trustee,”
Boston Globe,
March 8, 1925; “Blass Denies He Was an Agent for Ponzi,”
Boston Globe,
November 9, 1920.

143

Napoli Macaroni Manufacturing Company: “Well-Known Men Got Big Hauls from Ponzi,”
Boston Post,
August 25, 1920, p. 1; Summary of Debts and Assets of Charles Ponzi in Bankruptcy, Schedule B(2), Case 28063, on file at the National Archives and Records Administration in Waltham, Massachusetts; Ponzi, p. 104.

144

Ponzi walked unannounced: Ponzi, pp. 106–8. Although Ponzi is the only source of the exchange between himself and Poole, his account is supported by verifiable facts about his purchase of the company. See Summary of Debts and Assets of Charles Ponzi in Bankruptcy, Schedule B(2), Case 28063, on file at the National Archives and Records Administration in Waltham, Massachusetts; “Ponzi Creditors May Get Back 47 Percent,”
Boston Globe,
October 6, 1920.

145

He bought a small tenement house: Summary of Debts and Assets of Charles Ponzi in Bankruptcy, Schedule B(2), Case 28063, on file at the National Archives and Records Administration in Waltham, Massachusetts; “Ponzi Creditors May Get Back 47 Percent,”
Boston Globe,
October 6, 1920; Ponzi, p. 104.

145

forty thousand dollars to Charles Pizzi: “Bank Cashed Ponzi Notes for $240,000,”
Boston Globe,
September 1, 1920, p. 1. Pizzi's notes were not included in the schedule of Ponzi's bankruptcy assets because Pizzi took responsibility for repaying them.

145

The smallest, for five hundred dollars: Summary of Debts and Assets of Charles Ponzi in Bankruptcy, Schedule B(2), Case 28063, on file at the National Archives and Records Administration in Waltham, Massachusetts; “Well-Known Men Got Big Hauls from Ponzi,”
Boston Post,
August 25, 1920, p. 1; Ponzi, p. 123.

145

He bought fifty shares: Summary of Debts and Assets of Charles Ponzi in Bankruptcy, Schedule B(2), Case 28063, on file at the National Archives and Records Administration in Waltham, Massachusetts.

145

Hanover Trust, a bank with about $5 million: Annual Report of the Massachusetts Commissioner of Banks, 1920, p. vi, and 1921, pp. vi–xv.

146

The largest mortgage loan Ponzi made: Summary of Debts and Assets of Charles Ponzi in Bankruptcy, Schedule B(2), Case 28063, on file at the National Archives and Records Administration in Waltham, Massachusetts.

146

he controlled about six hundred: Ponzi, p. 100.

146

issue another two thousand shares:
Cunningham v. Commissioner of Banks,
144 N.E. 447.

146

Ponzi was depositing more: Ibid. Also “Story of Hanover Trust Company and Ponzi,”
Boston Globe,
August 31, 1920, p. 1.

147

One afternoon in early June: The narrative account of Ponzi's effective takeover of the Hanover Trust Company comes from Ponzi himself; see Ponzi, pp. 100–103. Ponzi engages in a certain amount of self-aggrandizement on the subject of Hanover Trust, but his version fits with the findings of the Massachusetts bank commissioner, the testimony of Hanover Trust officials in Ponzi's bankruptcy and criminal court cases, and the rulings of several judges, including the Supreme Judicial Court of Massachusetts, in
Cunningham v. Commissioner of Banks,
144 N.E. 447.

147

Chmielinski was a bull of a man: “Polish Industrial Association Was Closed Up Today,”
Boston Evening Globe,
August 14, 1920, p. 1; census data on Henry Chmielinski from 1930; photographs of Chmielinski from the files of the
Boston Globe.

148

bank's annual meeting of stockholders:
Cunningham v. Commissioner of Banks,
144 N.E. 447.

148

The more he bought: Ponzi, p. 105: “The more I bought, the more I wanted to buy.”

149

a latter-day Count of Monte Cristo: Ibid., p. 106; Alexandre Dumas,
The Count of Monte Cristo,
trans. Robin Buss, Penguin, 1997.

149

he wanted to “test its power”: Ibid., p. 99.

149

“Wrap it up, please”: Ibid., p. 106.

150

“The more servants, the less freedom”: “Ponzi Long Had Plan for Riches, Says Wife,”
Boston Globe,
July 30, 1920.

150

a glittering diamond bracelet: “Mrs. Ponzi Would Not Take Gems,”
Boston Post,
November 22, 1922.

150

a string of lustrous pearls: Clarence White, “Mrs. Ponzi Says, ‘We Will Stay Here and Square Debts,' ”
Boston Globe,
July 17, 1921.

151

a Boston terrier puppy: “Ponzi Pursued,”
Boston Post,
August 13, 1920, p. 9.

151

Ponzi was dealing with: The colloquy between Ponzi and the inspectors comes from his autobiography, pp. 109–11. Confirmation comes, in part, from court testimony by Al Ciullo, who confirmed that he had received a package of reply coupons from Italy and brought them to Ponzi. “Hope to End Ponzi Case by Wednesday,”
Boston Globe,
November 25, 1922; “Affecting Meeting of Ponzi and His Mother,”
Boston Globe,
November 24, 1922.

152

John Elbye of Everett: “
Post
Prints List of Ponzi Investors,”
Boston Post,
August 23, 1920, p. 1. It took two weeks for the newspaper to print the complete list, and some names are taken from later entries. Information on some of the depositors was supplemented by 1920 and 1930 U.S. Census data.

152

an unassuming man with a prominent nose: The Securities Exchange Company note issued to Principio Santosuosso was reproduced in “Mr. Ponzi and His Ponzied Finance,”
Literary Digest,
August 21, 1920, p. 49. Details of his life come from U.S. Census data and from Edward Martin, “Retiring Editor of Italian Newspaper Proud of 30-Year Record of Service to North End Folk,”
Boston Post,
June 22, 1952, found in the newspaper files of the Boston Public Library.

153

J. Rufus Wallingford: George Randolph Chester,
Get-Rich-Quick Wallingford: The Cheerful Account of the Rise and Fall of an American Business Buccaneer,
Curtis Publishing Company, 1907. Ponzi certainly read the book. He titled the introduction to his autobiography “Meet Mr. Ponzi, the Champion Get-Rich-Quick Wallingford of America.” His tone and chapter titles also strongly echo Chester's. For instance, Ponzi's chapter 12 is titled “Mr. Ponzi Finally Discovers an Untrodden Path to Fabulous Wealth and Takes It.” Chester's chapter 3 is titled “Mr. Wallingford's Lamb Is Carefully Inspired with a Flash of Creative Genius.”

154

wired more than five thousand dollars: Nancy Wrynne, “Ponzi's Home Life Is Simple and Devoid of Ostentation,”
Boston Sunday Herald,
August 1, 1920; “Receipts Produced by Ponzi: Sent $7,500 to Italy Since Sept. 5, 1919,”
Boston Post,
August 3, 1920, p. 2.

154

Rose worried: Charles Merrill, “His Pretty Girl Wife Sorry When Ponzi Quit $50 Job,”
Boston Globe,
August 8, 1920, p. 8.

154

Roberto de Masellis: “Reporters Convinced of De Masellis' Honesty,”
Boston Evening Globe,
August 26, 1920, p. 8; “Ponzi Asks Aid . . . Witness Says Foreign Exchange Plan Feasible,”
Boston Transcript,
October 27, 1922.

155

“Mr. Ponzi bears a favorable”: A copy of the credit report, which describes the June 30, 1920, visit and was dated July 26, 1920, was found among the oldest stories on Ponzi in the
Boston Globe
clippings library.

155

obtain coupons from Poland: Ponzi, pp. 111–13.

155

“I was left high and dry”: Ibid., p. 113.

155

clerks had filled wastebaskets with greenbacks: Ponzi, p. 99.

155

In June alone: Monthly investment totals come from the federal audit that led to the closure of the Securities Exchange Company and were evidence at Ponzi's 1922 trial. “How the Bubble Grew,”
Boston Evening Transcript,
November 6, 1922, p. 24.

155

prohibiting post offices from redeeming: “Seeking Source of Big Profits,”
Boston Post,
July 28, 1920, p. 20.

156

a ten-thousand-dollar loan:
Cunningham v. Commissioner of Banks,
144 N.E. 447.

156

He paid all Gnecco Brothers' creditors: The Bradstreet Company credit report dated July 26, 1920.