Great frauds in history: Jerry Dominelli’s Ponzi scheme

J. David “Jerry” Dominelli's classic Ponzi fraud cheated investors out of $80m in the 1980s.

Businessman running with briefcase full of cash illustration
(Image credit: Malte Mueller)

J. David "Jerry" Dominelli was born in Chicago in 1941, graduated from the University of San Diego, and went on to became a stockbroker. In 1979 he set up J. David & Company, an investment company that claimed it could make returns of around 40%-50% a year on the interbank and foreign-currency markets. While many people were sceptical, its apparent initial success led to a flood of investors and Dominelli broadened the fund's activities into other ventures, such as real estate. By 1983 the fund had received more than $200m ($504m in today's money) from 1,500 investors.

What was the scam?

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Dr Matthew Partridge
Shares editor, MoneyWeek

Matthew graduated from the University of Durham in 2004; he then gained an MSc, followed by a PhD at the London School of Economics.

He has previously written for a wide range of publications, including the Guardian and the Economist, and also helped to run a newsletter on terrorism. He has spent time at Lehman Brothers, Citigroup and the consultancy Lombard Street Research.

Matthew is the author of Superinvestors: Lessons from the greatest investors in history, published by Harriman House, which has been translated into several languages. His second book, Investing Explained: The Accessible Guide to Building an Investment Portfolio, is published by Kogan Page.

As senior writer, he writes the shares and politics & economics pages, as well as weekly Blowing It and Great Frauds in History columns He also writes a fortnightly reviews page and trading tips, as well as regular cover stories and multi-page investment focus features.

Follow Matthew on Twitter: @DrMatthewPartri