Ponzi's Scheme
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Clarence Barron: “Clarence W. Barron Could Dictate Four Letters at the Same Time,” Boston Post, October 7, 1928; They Told Barron: Conversations and Revelations of an American Pepys in Wall Street, Harper & Brothers, 1930, pp. xv–xxxiii.
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their long-running sexual extortion scheme: “Unanimous Decision of 5 Justices for Pelletier’s Removal,” Boston Sunday Post, November 5, 1922, p. 58.
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suicide triggered by his humiliation: Beatty, p. 247.
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the irrepressible Coakley: “Daniel H. Coakley Dead at 87; Long Political Figure,” Boston Herald, September 19, 1952.
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J. Weston Allen: “J. Weston Allen Dies at Age of 69,” Boston Post, January 1, 1942, p. 1; “J. Weston Allen Funeral Today at Mt. Auburn,” Boston Globe, January 2, 1942.
297
Albert Hurwitz: “Albert Hurwitz,” Jewish Advocate, August 8, 1985, obituary, p. 19.
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people who had lost money: Katharine Bartlett, “Holders of Ponzi Notes Flock to State House as Last Hope,” Boston Globe, August 14, 1920, p. 3.
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Joseph Pearlstein: “Pearlstein Made $500—Now He Sets Good Example,” Boston Globe, August 14, 1920, p. 2.
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refunds equal to 37.5 percent: “Estate of Ponzi Now Cleared Up,” Boston Post, December 17, 1930.
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Joseph “Sport” Sullivan: “Gambler Indicted for Bribery of White Sox Players,” Boston Herald, September 30, 1920, p. 1.
298
Herb Baldwin was distracted: Kenny, p. 161; “Store Cat Challenges Hindy to Catnip Meet,” Boston Sunday Post, October 5, 1920.
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a brief encounter with Ponzi: “More Arrests Are Coming in Ponzi Case,” Boston Post, August 20, 1920, p. 1.
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public relations job: “Herbert L. Baldwin, 79, Former Boston Newsman,” Boston Herald, January 23, 1973.
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Eddie Dunn: Caption under a photograph printed in the Boston Herald, March 20, 1953.
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Twice during his Post tenure: “Post Executive E. J. Dunn Dies,” Boston Herald, May 6, 1961, p. 1.
299
P. A. Santosuosso: Edward T. Martin, “Retiring Editor of Italian Newspaper Proud of 30-Year Record of Service to North End Folk,” Boston Post, June 22, 1952; “Pay Tribute to Santosuosso,” Boston Post, March 11, 1931.
300
Post’s investigation of Ponzi was awarded the Pulitzer Prize: “Bursting Golden Bubble Wins Gold Medal,” Editor & Publisher, June 4, 1921, p. 1.
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The Post made news of the prize: “Pulitzer Prize Is Awarded to Post,” Boston Post, May 30, 1921, p. 1.
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Edwin Grozier set the record straight: Edwin A. Grozier, “The Ponzi Award of Merit,” Boston Post, editorial page, p. 14, June 1, 1921.
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“public spirit, courage, and persistence”: Photo caption in the Boston Post, October 20, 1921, upon presentation of the Pulitzer gold medal.
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final fatherly words of advice: “Edwin A. Grozier’s Will Is Filed,” Boston Post, June 14, 1924.
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Margaret “Peggy” Murphy: “Richard Grozier Weds in New York,” Boston Globe, October 29, 1929.
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died giving birth: Interview with Mary Grozier, March 7, 2003; “Mrs. Richard Grozier Passes Away Suddenly,” Boston Post, June 28, 1933.
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Helen Doherty: “Richard Grozier Marries Nurse,” Boston Traveler, January 19, 1934.
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committed to McLean Hospital: Interview with Mary Grozier, March 7, 2003.
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Inscribed on the plaque: “Tribute Paid to Post Publisher,” Boston Post, September 23, 1946.
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struggling to survive: The decline of the Post is best told by Kenny, pp. 218–29.
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In October 1922 he was back in court: “Jury Is Ready to Try Ponzi,” Boston Globe, October 24, 1922, p. 1.
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a dozen of the indictments against him: “Ponzi Own Lawyer in Trial for Larceny,” Boston Globe, October 23, 1920, p. 1.
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Lucy Meli: “Questions Ex-Secretary,” Boston Globe, October 25, 1922, p. 1.
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regaling the jury with his life story: “Coakley on Stand,” Boston Globe, November 28, 1922, p. 1.
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Carmela Ottavi: “Ponzi Wins Avowal of Confidence,” Boston Post, November 1, 1922, p. 9.
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all found innocent: “Find Ponzi Not Guilty,” Boston Post, December 2, 1920, p. 1; “Ponzi Is Acquitted of Larceny Charge,” New York Times, December 2, 1922, p. 9; “Ponzi Verdict Arouses Allen,” Boston Globe, December 3, 1922, p. 1; “Ponzi Is Freed; Goes to Jail All Smiles,” Boston Traveler, December 2, 1922, p. 1.
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the painful ulcers: “Ponzi Will Be Brought to This City for Operation,” Boston Globe, January 14, 1923; “Ponzi Doing Well After Operation,” Boston Globe, undated clip, marked “1923.”
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“I do hope that I may live”: Letter from Ponzi to Rose, postmarked January 1, 1923; generously provided by the Gnecco family.
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back on trial: “Ponzi Goes on Trial,” Boston Globe, November 5, 1924.
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Ponzi’s luck ran out: “Guilty on 14 Counts,” Boston Globe, February 26, 1925, p. 1; “Charles Ponzi Is Sentenced,” Boston Globe, July 11, 1925, p. 1.
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Charpon Land Syndicate: “Florida Lot Plan Opens,” Boston Traveler, January 12, 1926, p. 1; Robert Norton, “U.S. Keeping One Eye on Mr. Ponzi,” Boston Post, December 8, 1925, p. 1; “Faithful Rose Squeezes Pennies in Florida to Aid Ponzi in ‘Come-Back.’ ” Boston Traveler, December 18, 1925, p. 15; “Ponzi’s Friends Declare Wizard Will Give Self Up,” Boston Globe, February 9, 1926; “Find Water over Ponzi’s $10 Lots,” Boston Post, February 10, 1926, p. 1.
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violating Florida’s securities laws: “Charles Ponzi Sentenced to Year in Prison,” Boston Globe, April 21, 1926.
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Sic Vos Non Vobis: Charles Ponzi, “Lay Off and I’ll Get Out,” Boston Post, June 30, 1926, p. 1; “Inspector Mitchell Tells Inside of Ponzi’s Capture,” Boston Herald, February 27, 1927, p. 1; Alfred Shrigley, “The Extradition of Charles Ponzi,” City Club Life, February 17, 1931, p. 3.
307
selling an account of his capture: “Ponzi Appeals to Mussolini for Aid,” Boston Globe, July 2, 1926.
307
appealed to Calvin Coolidge: “Ponzi Asks Help from President,” Boston Globe, July 4, 1920, p. 1. A copy of the telegram was found on the Web site www.mark-knutsen.com.
307
Benito Mussolini: “Ponzi Appeals to Mussolini for Aid,” Boston Globe, July 2, 1926.
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Rose accompanied Imelde Ponzi: “Ponzi Begins 7 to 9 Years Prison Term,” Boston Globe, February 16, 1927, p. 1.
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sewing underwear: “Ponzi Given Prison Work,” Boston Globe, February 21, 1927.
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mother was on her deathbed: “Ponzi’s Parent Dies in Italy,” Boston Post, April 18, 1930.
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the item began: “Ponzi Payment,” Time magazine, January 5, 1931, p. 42; Ponzi’s reply was printed January 26, 1931, under the headline “Ponzi from Prison.”
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“It’s great to see you boys”: “Ponzi Unable to Raise $1,000 Bail,” Boston Globe, February 15, 1934, p. 1.
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Ponzi’s old nemesis: “Decided Soon After Hearing,” Boston Globe, July 10, 1934, p. 1.
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Ponzi went to the Post: Kenny, p. 202.
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“I am not bitter”: “Ponzi Leaves Boston in Brig of Liner Vulcania,” Boston Herald, October 8, 1934, p. 1; “Ponzi Deported, Leaves in Tears,” Boston Globe, October 8, 19
34, p. 1.
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she could no longer remain Mrs. Ponzi: “Wife of Ponzi Seeks Divorce,” Boston Globe, June 27, 1936; “Wife’s Divorce Suit ‘Tragic,’ Says Ponzi,” Boston Globe, June 27, 1936.
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“When he was down”: “Mrs. Ponzi Files for Divorce,” Boston Post, June 27, 1936.
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tried to bluff Rose into jealousy: Letter from Ponzi to Rose, dated July 29, 1941.
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his cousin Attilio Biseo: James Alan Coogan, “Spy Plot Shown Up by Ponzi,” Boston Post, April 27, 1942, p. 1; Also, Ponzi wrote frequently about Biseo in his letters to Rose. Ponzi often called Biseo his nephew, but it appears more likely they were cousins; Ponzi’s references to him as a nephew might have been because of the difference in their ages.
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efforts to expose a smuggling ring: “Spy Plot Shown Up by Ponzi,” Boston Post, April 27, 1942, p. 1.
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“quite a tidy sum here”: Letter from Ponzi to Rose, dated August 18, 1943.
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a heart attack: James Alan Coogan, “Spy Plot Shown Up by Ponzi,” Boston Post, April 27, 1942, p. 1.
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manager of the Cocoanut Grove: Lester Allen, “Club Finances in Name of ‘Straw,’ ” Boston Post, December 8, 1942, p. 1; “Welansky Deposited Funds in the Name of Rose Gnecco,” Boston Globe, December 8, 1942, p. 1.
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“Of course I am”: Letter from Ponzi to Rose, dated July 29, 1941.
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“I have missed you terribly”: Letter from Ponzi to Rose, dated June 26, 1943.
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A reporter for the Associated Press: Hoyt Ware, “Ponzi, Once Wizard, Now Broken Old Man in a Charity Hospital,” Boston Globe, May 4, 1948. Ware’s story received wide attention, appearing in numerous newspapers across the country.
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“Life, hope, and courage”: Ponzi, p. 172.
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died of a blood clot: “Ponzi Dies in Rio in Charity Ward,” New York Times, January 19, 1949.
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his body returned to Boston: “Won’t Try to Return Ponzi Body,” Boston Post, January 19, 1949, p. 1.
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a full page in Life magazine: “Ponzi Dies in Brazil,” Life, January 31, 1949, p. 63.
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the one thing Ponzi had never lost: Interviews in April and May 2003 with John Gnecco, Florence Gnecco Hall, and Mary Gnecco Treen.
SELECT BIBLIOGRAPHY
Allen, Frederick Lewis. Only Yesterday: An Informal History of the 1920s. New York: Harper & Row, 1931.
Andros, Howard S. Buildings and Landmarks of Old Boston: A Guide to the Colonial, Provincial, Federal, and Greek Revival Periods, 1630–1850. Lebanon, N.H.: University Press of New England, 2001.
Barron, Clarence W. They Told Barron: Conversations and Revelations of an American Pepys in Wall Street. New York: Harper & Brothers, 1930.
Beatty, Jack. The Rascal King: The Life and Times of James Michael Curley (1874–1958). New York: Perseus Publishing, 1992.
Bulgatz, Joseph. Ponzi Schemes, Invaders from Mars and More: Extraordinary Popular Delusions and the Madness of Crowds. New York: Three Rivers Press, 1992.
Chester, George Randolph. Get-Rich-Quick Wallingford: The Cheerful Account of the Rise and Fall of an American Business Buccaneer. New York: Curtis Publishing Company, 1907.
Churchill, Allen. Park Row. New York: Greenwood Publishing, 1973.
Cooper, John Milton. Pivotal Decades: The United States, 1900–1920. Reprint, New York: W. W. Norton & Co., 1992.
Dunn, Donald. Ponzi: The Boston Swindler. New York: McGraw-Hill, 1975.
Galbraith, John Kenneth. The Great Crash, 1929. Reprint, New York: Mariner Books, 1997.
Goodwin, Doris Kearns. The Fitzgeralds and the Kennedys: An American Saga. New York: Simon & Schuster, 1989.
Handlin, Oscar. Boston’s Immigrants, 1790–1880: A Study in Acculturation. Boston: Harvard University Press, 1991.
Kenny, Herbert. Newspaper Row: Journalism in the Pre-Television Era. Boston: Globe Pequot Press, 1987.
Kindleberger, Charles P. Manias, Panics, and Crashes: A History of Financial Crises. 4th ed. New York: John Wiley & Sons, 2001.
Kruh, David S. Always Something Doing: A History of Boston’s Infamous Scollay Square. New York: Faber & Faber, 1990.
Kyvig, David E. Daily Life in the United States, 1920–1939: Decades of Promise and Pain. Westport, Conn.: Greenwood Press, 2002.
Mackay, Charles. Extraordinary Popular Delusions and the Madness of Crowds. Reprint, New York: Three Rivers Press, 1995.
Maurer, David W. The Big Con: The Story of the Confidence Man. New York: Anchor Books, 1999.
Murray, Robert K. Red Scare: A Study in National Hysteria, 1919–1920. New York: McGraw-Hill, 1955.
Nash, Robert Jay. Hustlers and Con Men. New York: M. Evans and Company, Inc., 1976.
O’Connor, Thomas H. Bibles, Brahmins, and Bosses: A Short History of Boston. Boston: Boston Public Library, 1991.
———. The Boston Irish: A Political History. Boston: Northeastern University Press, 1995.
———. The Hub: Past and Present. Boston: Northeastern University Press, 2001.
Olian, JoAnne. Everyday Fashions 1909–1920. Mineola, N.Y.: Dover Publications, 1995.
Ponzi, Charles. The Rise of Mr. Ponzi. 1937. Reprint, Naples, Fla.: Inkwell Publishers, 2001.
Pringle, Henry F. The Life and Times of William Howard Taft: A Biography. New York: Farrar & Rinehart, 1939.
Puleo, Stephen. Dark Tide: The Great Boston Molasses Flood of 1919. Boston: Beacon Press, 2003.
Rayner, Richard. Drake’s Fortune: The Fabulous True Story of the World’s Greatest Confidence Artist. New York: Doubleday, 2002.
Russell, Francis. A City in Terror: 1919, the Boston Police Strike. New York: Viking Press, 1975.
———. The Knave of Boston: And Other Ambiguous Massachusetts Characters. Boston: Quinlan Press, 1987.
Sobel, Robert. The Great Bull Market: Wall Street in the 1920s. New York: W. W. Norton & Co., 1968.
ACKNOWLEDGMENTS
Heartfelt thanks to the Gnecco family, especially John and Betty Gnecco, William and Florence Gnecco Hall, and Mary Gnecco Treen, for sharing reminiscences and mementos of their great-aunt Rose Gnecco Ponzi Ebner. I am especially grateful to them for providing me with the letters Ponzi sent Rose during their marriage and after. I’m grateful also to Philip Treen for sharing his theories about his great-great uncle Ponzi.
I owe equal appreciation to Mary M. Grozier for trusting me with her memories and photographs of her father, Richard. Thanks also to Elizabeth and Damian Grozier.
I received generous support and genuine fellowship at the Batten Institute at the Darden Graduate School of Business Administration at the University of Virginia. Special thanks to Bob Bruner and Debbie Fisher. Greg Fairchild sponsored me for the fellowship, and for that and so many other things I thank him, Tierney Temple-Fairchild, and their entire family.
My agent and friend Richard Abate made this book possible, despite the fact that he suspects that a distant relative of his lost money with Ponzi. Thanks to Kate Lee for believing in this idea and saying so. My editor, Jonathan Karp, has the rare gift of knowing precisely what a writer needs to achieve his dreams. He provides it with grace, charm, and a steady hand. I am grateful to the entire Random House team, notably Jonathan Jao, Dennis Ambrose, and Bonnie Thompson.
In Ponzi’s hometown of Lugo, Italy, I received invaluable help from Rosanna Rava, who oversees registry documents in city hall. When we met, Rosanna was wearing a T-shirt that said “Boston Celtics,” which I interpreted as a grand omen. “Boston! That’s where I’m from,” I said. Confusion swept across her face; Rosanna’s English was as sparse as my Italian. When I looked more closely, I noticed that below the basketball team’s name was a sketch of a baseball player in midswing, and below that were the meaningless words “Spring Trophy.” Nevertheless, she patiently
listened as I explained Ponzi’s scheme in pidgin Italian. “Like Al Capone?” she asked. “Not really,” I said. “Capone took lives. Ponzi took money.” Rosanna smiled. “Ah. Bene.” Then she unearthed his birth record and census documents.
Genealogist Carolyn Ugolini traced Ponzi’s family history and led me to Rosanna. I am grateful for her creativity, persistence, and encouragement.
My friend and former professor Wilbur Doctor was among the journalists whom the Boston Post owed money when it failed a half century ago. Now I owe him, too, for the care he took in reading and improving this manuscript. I benefited as well from the insights and efforts of my friends and longtime colleagues Dick Lehr and Gerry O’Neill.
Ofer Gneezy and Christine McLaughlin graciously allowed me to traipse through their beautiful home to get a feel for what it was like when it belonged to Ponzi.
Henry Scannell of the Boston Public Library Microtext Department is a living treasure within a civic treasure. Thanks also to Aaron Schmidt of the library’s Print Department; research librarian Frank Wilmot of the Darden Graduate School of Business Administration; John Beck of the Albin O. Kuhn Library at the University of Maryland, Baltimore County; archivists Edouard Desrochers and Shelley Bronk of Phillips Exeter Academy; Michael Moore of the National Archives and Records Administration; Massachusetts judicial archivist Elizabeth Bouvier; Lisa Tuite of the Boston Globe library; John Cronin of the Boston Herald library; Evan Ide, curator of the Larz Anderson Auto Museum; Nancy Richard of the Boston Historical Society; Jim Gallagher of the Beebe Library at Boston University; and Millie Teixiera, secretary and resident historian at Saint Anthony’s Church in Somerville. Mark Mathosian deserves credit for rescuing Ponzi’s autobiography.