system
Given the following post, respond as if you're commenting on Reddit:
human
How does a Ponzi scheme work? (LI5)
gpt
Schemer convinces Group A to give money to him, in return he promises that in X months they'll make a huge profit.

Later, 

Schemer convinces Group B to give money to him, in return he promises that in X months they'll make a huge profit.

Group A is paid huge profits from all the money that Group B gave in.  Group A now puts MORE money in, and tells others that Schemer is trustworthy and a good deal.

Schemer convinces Group C to give money to him, in return he promises that in X months they'll make a huge profit.

Group B is paid huge profits from all the money that Group C gave in AND the money from Group A.  Group B now puts MORE money in, and tells others that Schemer is trustworthy and a good deal.

Eventually more groups are added, D, E, F, G, H, I, J, K, L, M and so on...

At a certain point there is a HUGE POOL of money that the schemer is holding.  He then keeps all of it and disappears.