Part 6: The Shopping Spree

Charles Ponzi couldn't afford office furniture in December 1919, but six months later, in May 1920, he has large sums of money at his disposal.

He has many bank accounts stuffed with outrageous sums of money, some of which he spends on shopping sprees. He keeps at least $10,000 in his car at all times, just in case he needs to buy something he hadn't planned on buying. As Bostonians become mired in the mania of using the life savings to invest in his promissory notes, Ponzi is caught up in the mania of spending their money on anything he had always dreamed. If a day passes by without him buying something, he feels disappointed.

One afternoon, a car salesman from The Locomobile Company of America passes by Ponzi's office with a catalogue of high-end cars his company is selling. He hopes to persuade Ponzi to buy one.

He's looked at several cars, but it's the Locomobile Model 48 that he craves.

Locomobile Model 48

The catalogue describes it as "The Exclusive Car for Exclusive People", and it is the favourite of most East Coast millionaires. It is famous for its speed, stability, and ability to turn heads.

It retails at $12,600, and Ponzi decides he wants one.

"When can I have it delivered," asks Ponzi.

"It will take at least three months," replies the salesman.

"I want it today," demands Ponzi.

The salesman informs Ponzi that his company assembles the Model 48 one at a time and only when a customer orders. He adds that they are now working on one for a New York millionaire and will take another two weeks to complete.

"I want that one," demands Ponzi.

"That's not possible. The owner has already paid for it," explains the salesman.

"If you give me that one, I will pay you an extra $1,000," offers Ponzi.

The car salesman delivers the car after two weeks.

A few days later, while driving through Lexington, one of Boston's wealthiest neighbourhoods, he comes across a lovely home that piques his curiosity, and when he stops over to inspect it, he discovers that the owner is selling it.

Ponzi's Home in Lexington

It features a circular conservatory with stunning views of landscaped gardens, an imaginative symmetrical design, and a welcoming curved columned front. The inside features crown mouldings, high ceilings, and a choice of magnificent hardwood flooring.

It is going for $40,000, and he buys it for Rose.

To secure his financial future, Ponzi invests in real estate, manufacturing, and finance.

He purchases a newly decorated Dutch colonial mansion in Winthrop for $14,000, a block of apartments in the city's west end for $6,000, and six additional properties with mortgages ranging from $1,500 to $35,000.

In June alone, he spends $61,000 to buy 1,000 shares of the Napoli Macaroni Manufacturing Company, $30,000 to buy 300 shares and controlling interest in C & R Construction Company, and $240,000 to buy the controlling interest in JR Poole, his former employer. Some of JR Poole holdings include a sardine Factory in Maine and a meatpacking factory in Kansas. Apart from buying JR Poole stocks, he also gives it $150,000 to undertake massive expansion, which includes opening several overseas branches.

In the financial world, he purchases 50 shares of Fidelity Trust Bank for $6,000, 500 shares of Tremont Trust Bank for $500, and 12,500 shares of Old South Trust Bank, but his most significant acquisition is the Hannover Trust Bank, which denied him a $2,000 loan when he was starting.

Ponzi has deposited $2.7, making him the bank's largest depositor. He pays $187,000 to acquire the controlling interest. That gives him control of over $5 million in assets, including the 14-storey Journal Building, which houses the bank, at the corner of Water and Washington Streets.

Besides acquisitions, Ponzi decides to use the huge funds at his disposal to pay his old debts. The collapse of the Gnecco Brothers, his wife's family's business, had resulted in $8,000 losses to creditors. Ponzi settles all of Gnecco Bothers creditors in full.

Also, there were the expensive gifts he bought Rose, like a $1,000 bracelet and a $3,000 necklace. Plus, he has paid $5,000 to buy a first-class ticket for his mum and her maid to visit him in the US.

June 30

Gives $10,000 loan to his brother-in-law George Bertolli, who is married to Rose's sister, to buy Ponzi Notes that would be worth $15,000 in August.