Ponzi's Scheme_ The True Story of a Financial Legend - Mitchell Zuckoff [133]
Several months later, Ponzi was sentenced to seven to nine years in state prison as “a common and notorious thief.” The sentence was stayed pending Ponzi’s appeal, and he remained free on bail. Granted that reprieve, Ponzi began plotting his comeback, determined to repay all his creditors and regain his fortune.
For a few months he earned money doing a vaudeville act—a corny reprise of the impromptu stage show he had done at Keith’s Theater—but he knew the real money was in large-scale investments. In September 1925 he and Rose headed south to a huckster’s version of paradise, joining the tail end of the Florida land boom.
To avoid unwanted scrutiny, he at first adopted the alias Charles Borelli. But his ego could not quite stand the anonymity. He named his company the Charpon Land Syndicate—“Charpon” being an abbreviation of his real name. When Ponzi’s true identity was revealed, he decided to make the most of his notoriety. He offered investors a better return than from the Securities Exchange Company: 200 percent in sixty days. The promise of such immense profits was based on Ponzi’s far-fetched plan to sell ten million tiny lots of property around Jacksonville.
With money borrowed from his few remaining friends, Ponzi began the scheme by buying a hundred acres of land for forty dollars an acre. The property was in an area Jacksonville officials called “desolate and lonely,” and at least some of it was waterlogged. Ponzi named it the Rose Maria tract after his wife. The Oreste and Imelde tracts would follow to honor his parents. He divided each acre into twenty-three puny lots he planned to sell for ten dollars each. That meant every acre would yield a profit of $190, or nearly 500 percent of Ponzi’s original investment. Ponzi also intended to sell shares in his new company for investors more focused on profits than land. But his impossible dream was short-lived. Goaded into action by newspaper reports, Florida and Massachusetts officials quickly shut down the Charpon Land Syndicate. Ponzi beat charges of land fraud but was sentenced to a year in jail for violating Florida’s securities laws. He was allowed to remain free pending an appeal.
Two months later, in June 1926, a dejected Ponzi decided he could not bear a return to prison. With Massachusetts authorities clamoring to bring him north to begin his seven- to nine-year prison term, and the yearlong Florida sentence looming as well, he disappeared. Eluding a nationwide manhunt, Ponzi made his way to Tampa, where he hoped to land a berth on an Italian freighter at the port. For several days he waited, and then he spotted a ship fittingly called the Sic Vos Non Vobis. The ship’s name translates from the Latin as “Thus not for yourselves,” a phrase used by the poet Virgil to decry those who profit unduly from the labors of others.
Ponzi called himself Andrea Luciana and signed aboard as a waiter and dishwasher, relying on skills he had honed during his early days in America. The ship left Tampa bound for Houston, and during the trip Ponzi disguised himself by shaving his head, growing a mustache, and outfitting himself in overalls and a sailor cap. Before he’d left, he’d added to the intrigue by faking his suicide, asking friends in Jacksonville to place some of his clothing on a beach with a note apologizing to his wife and mother for taking his life. But Ponzi made the mistake of revealing his identity to a shipmate, and word spread to a deputy sheriff named George Lacy. The deputy followed the ship to Galveston and then New Orleans, where Lacy confirmed Ponzi’s identity and placed him under arrest. The only good that came of it for Ponzi was the five hundred dollars he earned by selling an account of his capture to the Post.
Flanked by authorities, Ponzi prepares for extradition to