Fraud is an action that involves deceit, misdirection, or some form of trickery, and it is a crime. If you commit fraud then you knowingly and intentionally do so in order to profit from your activity in some way. The dishonesty used in order to achieve the fraudulent goals makes this crime one that can cause tremendous harm. A Ponzi scheme is fraud designed to gain the trust of others and get them to contribute money under false pretenses.