In cryptography, a "tontine" is a secret sharing algorithm which allows n people to share secret data, such that any k of them can reconstruct it by combining their keys.

A tontine is an investment vehicle which combines features of a group annuity, group life insurance, and a lottery.

The scheme is named after Neapolitan banker Lorenzo de Tonti, who is generally credited with inventing it in France in 1653. Some sources claim that similar schemes already existed in Italy, but there is no dispute that the popularity of the form was due to Tonti.

The basic concept is simple. Each investor pays a sum into the tontine. The funds are invested and each investor receives dividends. As each investor dies, his or her share is divided amongst the surviving investors. This process continues until only one investor survives. Originally, the last surviving subscriber received only the dividends: the capital reverted to the state upon his or her death and was used to fund public works projects, which often contained the word "tontine" in their name. In a later variation, the capital would devolve upon the last survivor, effectively dissolving the trust, and it is this version that has often been the plot device for mysteries and detective stories.

While once very popular in France, Britain, and the United States, tontines have been banned in Britain and the United States due to the incentive for investors to kill one another, thereby increasing their shares. Nevertheless, there are underground organizations in the US that still use the tontine, and ownership of a business or property by joint tenancy with right of survivorship has much the same effect.

Tontines in fiction

Tontines have often appeared in fiction, usually, but not always, as a motive for murder.

• In The Wrong Box, a novel by Robert Louis Stevenson, the object is to conceal the death of one of the last two investors.
• A more innocuous tontine was the subject of a M*A*S*H episode in which Colonel Potter, the last survivor of his World War I unit, inherits a bottle of brandy (the last of a cache the unit found) with which to toast the memory of his old comrades.
• In an episode of The Simpsons, Grandpa and Mr. Burns, having entered into a tontine during World War II, struggle with one another over the treasure, a safe filled with contraband paintings.
• A tontine is also used as a plot device in the novel Seventy Seven Clocks by Christopher Fowler, and in one of the Dr Syn books.
• P.G. Wodehouse used a similar idea in his novel Something Fishy (The Butler Did It in the US.) In Wodehouse's version, the money did not go to the last survivor, but to the last son of the investors who remained unmarried.

Investment | Plot devices

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