Published on September 19th, 2013 | by Flipside0
Knitsoc revealed to be Ponzi Scheme
Students at the University of Edinburgh are in shock this week as Knitsoc, a society people previous assumed was a joke in the societies’ guide, was revealed to be operating a complex system of financial fraud which has aggressively trapped vulnerable students for over 10 years.
The Ponzi scheme worked by taking money at the start of the year from students, claiming it would invest it in Harris Tweed, and then using word of mouth to expand the pile, slowly rewarding the initial investors, but keeping the money of the later investors after claiming that the Tweed factory ‘shut down’. The scheme is estimated to have robbed around £1.5m from vulnerable students since 2001, and is currently under investigation by Fraud Squad and the Financial Conduct Authority.
Nadia Mehdi, Vice-President of Societies and Activities for Edinburgh University Students Association (EUSA), said that the activities were disgusting and condemned them on behalf of EUSA, however she would not divulge if she herself had invested in the scheme at any point.
Knitsoc are not the first society to be investigated for fraud this year. The Guild of Charge Ringers are presently all imprisoned, under investigation for class A drug trafficking, while SocieTEA are currently under suspicion for running a complex money laundering operation out of the Pleasance.