Why I Hate Bernie Madoff

If one thug kills another thug, he gets life in prison or, possibly the death penalty. But a financial fraudster, who impacts thousands of families, gets 5-10 years typically?

We need to make felony fraud a life-in-prison penalty. We should expect more out of white-collared professionals.

Jon's comment above is absolutely right - white collar financial crime is viewed as such a minor infringement on people, even though its long-term impact on thousands of people is significantly highly than being mugged. Madoff should spend the rest of his life in jail and all his assets should be dissolved.

Its not rocket science. One should only invest in what one understands. Buffett has being saying that freely for years.

Take him and the people he ripped off out where nobody can hear the screams and let the bunch of them work things out...

I am beginning to think that those who put their trust solely in man are in for nothing but sorrow and disappointment.

What more proof do we need? How are the monetary and economic trials we face any different than locusts of Biblical days eating all the food? We are in days of judgment.

We need to cry out to God above, repent and he will heal our land...if it's not too late.

That's what I think.

I think it is hilarious! Madoff's "investors" knew he was ripping someone off-they just did not know it was them!

But just watch-now their buddies on Wall St., the Fed, and ultimately the taxpayer will be asked to bail them out-and it will probably happen.

The whole banking system is crooked and the CEOs and managers of same belong in jail

Investing because "that's what people do in your family" isn't very bright, and it is pretty clear that people who invested with Bernie thought they were in on, euphemistically, a very sweet deal. They though they were the ones benefitting from the scam, they were the insiders with privelege. They should have avoided this and invest like REAL "regular people" who don't have a million bucks to allocate with one manager. Please - you New York MOT just don't get it.

Going to the mattresses anyone?

Strip him of his possessions and worth and let him live on the streets.

Why were individuals, and organizations, putting all of their eggs in one basket? I'm not a sophisticated investor at all. But even I know that you dont put all of your eggs in one basket or in one mutual fund or in one hedge fund. Yes, the returns were high, year after year. Greed ruled the day. I'm sad for the folks who worked for institutions that put all of their money with Madoff and have now lost their jobs and pensions. But wealthy investors who couldnt be satisfied with what the rest of us were earning have less sympathy from me.

Unfortunately, what God intended hasn't come to fruition because man (read "us") and our free will have taken everything in the direction that "we" wanted -- why are we surprised? As such, we now live in a paranoid world in which we have lost our trust and, for way too many, our faith in God above. We, ourselves, need to be honest and stop waiting for the next guy to do it. It's a grassroots effort that needs to happen -- not one that we can hope the politicians, PAC's or anyone else will do on our behalf. It needs to begins and will need to continue long after we're over this mess, with us in our every day dealings and doings.

Thanks everyone for your comments thus far. As you can imagine, I like Dingbat's suggestion the best!

On my way to work this morning, I read a good first-person account of another real person, a retiree, who lost everything in the NY Post today. Here is the link:

http://www.nypost.com/seven/12162008/news/regionalnews/weve_lost_everything_144414.htm

Incidentally, the cover of today's NY Post is "The Most Hated Man in New York." There's a lot of hate to go around.

It is curious that the anger and rage is directed at Madoff. But the trust and the desire of his investors to game the system in their favor is never questioned.

The steady returns Madoff 'realized' on paper were widely known to be impossible, by any legal strategy. Yet, he was able to cultivate the trust of even the most savy, who accepted his preposterous account statements as solid. In participating, investors of Madoff actually enabled other investors to be defrauded.

Instead of exacting revenge, a better option would be to recognize that transparency and strong regulatory compliance are the needed in all aspects of capitalism. Otherwise, it is simply cronyism, which only provides illusions of wealth. My guess is that many of Madoff's clients were strongly opposed to government intervention in the financial markets.

I agree completely with Jack Alderson and Greensleeves. Anyone with any type of experience in the real world and/or business would know that this was a scam. These are privileged people who felt that they were privileged enough to be let in on a nice arrangement that would keep them wealthy forever. Well the buck stops here kiddo. Get a real job! LOL

I am not sure what Madoff is SUPPOSED to have done...it seems to me that he did the same thing that all investment firms are doing right now...which, we can see, is not really working out all that well for any of them...or for us.

Basically you have this guy, who realizes that the WHOLE investment banking industry is ONE big Ponzi scheme...he freaks out in his office when he see the entire thing crumpling (he has probably been under tremendous strain to try and hold this thing together for GOD knows how long) and starts giving his honest opinion to his employees (the whole Ponzi scheme thing).

The next thing we know Madoff's arrested (can someone explain to me WHY we arrested Madoff and NOT all the other buffoons in the banking industry who ran this country into the ground?) and we all have a high profile whipping boy...isn't this fun...someone to pour our derision out on, while the others in Wall Street continue on their merry way.

By the way, we all knew that 'investing' is nothing more that gambling...and you should never gamble what you can't afford to loose.

Madoff was the Santa Claus. Unfortunately people realized little bit soon than Jan 1st. Is this the only pyramid scheme. If the government / system is serious, they should dig out all the similar pyramid scheme before the balloon burst. Maybe misspelled, but have you guys heard about Am way - Quick star - and so on. Pay $300 for member ship and get 5 members and you get your $300 back or similar. Wake up. Two week later on Jan 1st no more Santa Santa.

I am related to Bernie. Most of my family had accounts with Bernie because he married into our family years ago and we have lost nearly everything. I agree with most of your convictions, but there is something to be said to all of you who have no sympathy. You think it will never happen to you. Just wait.

The schadenfreude in these comments is so disheartening. Why add insult to injury and blame the investors? The institutional investors, yes - because it is their job to investigate these matters. However, the individual investors? They invested their (hard earned) money into an investment fund that seemed as trustworthy as it gets.

If you can't trust the former chairman of the Nasdaq with a sterling reputation and philanthropist, who can you trust? If a plane crashed, would you blame the surviving victims by saying they should have better researched the pilot? Maybe so, if it was a fly by night operation... but what if it was the most reputable and trusted airline with the best safety record?

I am one of those who lost my life savings to Madoff. But what hurts most of all, believe it or not, is the nastiness and arrogance of these people who think they have good vision when all they have is hindsight.

Things like this need to remind us all of how important it is to act with integrity and honesty. Of course that goes for Madoff, but it especially goes for all of us. How we treat each other, and the empathy we can have for each other matters.

My mattress is no where near full...so I'm good for now.

"I’m no judge, but I believe no amount of jail time in a maximum security prison, not even medieval torture, can do justice."

Oh, I don't know about that. I think stoning would be great! Think about the joy and satisfaction that would come to those that he has wronged, if they get to throw rocks at him...

Wow. My fellow commentators, how can you say that the investors thought it a scam, or that they were greedy, or that you can't understand why people put all their eggs in one basket - keep in mind that this was a stable investment. It is known that the stock market (over time) grows at an average of about 10% a year. And that is what Madoff's fund was doing. When the tech bubble and boom years were showing 50% etc a year, he was still only up 10%. This appears as the opposite of greed. It gives faith in stable calls of good judgment. If you had your money diversified into 5 accounts and 10 years later see that one of them was far more stable and far more dependable, wouldn't you transfer the bulk into that?

Madoff screwed individual investors to the tune of $50b? Whoop-ti-freaking-do. What an amateur. Goldman-Sachs, Merrill Lynch, Morgan Stanley, Lehman Brothers, Bear Stearns, AIG, Fannie Mae & Freddie Mac screwed ALL AMERICANS for several trillion.

Stalin's comments that "a single death is a tragedy, a million deaths is a statistic" applies here. We are appalled that Bernie Madoff defrauded investors of $50B, and we don't even react to the REAL disaster Congress voted down our heads when they bailed out all the Big Time Crooks.

Damn them all to Hell.

Nina Silver.....What a true lady you must be. Your words ring with the truth. I found your comments exceptional and my hat is off to you. Best of luck to you..

From the movie "Trading Places": "The best way to punish rich people is to make them poor people." I hear there's an apartment for rent in Camden, NJ. I am sure that he will be welcome there with open arms.

I always found it odd that as a society people never viewed the stock market as a form of gambling. Well, people are starting to wise up. Whenever you put your money in the stock market you are gambling. Granted, some gambles are more secure than others, but in the end it is still gambling.

So the next time you hear that someone you know plays poker for a living or bets on football games you will need to think twice before calling him a degenerate since we now know that everyone on Wall Street is gambling.

Live by the Sword you Die by the Sword.

Madoff was infected by Greed...plain and simple. But to claim that those he ripped off were innoncent is a bunch of Bull. Sure there may have been a few unsophisticated investors that got scammed but as far as the rest of the Palm Beach Country Club Gang....I have no sympathy. They are all a bunch of greedy bastards that are far from innocent. They gave Madoff their money to get those unexplainable returns..all in the name of greed!!! EASY COME EASY GO! I enjoy it all though! It is all so hillarious to me!

OK, I gotta say it. I am SO TIRED of writers here at Business Week (and the WSJ and Time etc.) saying "What his happening to business? What is going on behind those closed doors? We can't trust anyone it seems!" PLEASE!!!!! Business has ALWAYS been about screwing the other guy while you make yours. THe only difference now is that those CEO's are up front about it. There is no trust anymore. None at all. My father-in-law tell me you have to trust some in business (he runs his own very intregrity filled business, and while he does well, he could do better if he used the business models of some of his competors). So everyone wise up. If investments are returning 5% and someone offers you 15%, something is up. NO, they didn't find a way to invest that others havent thought of. NO, you are getting in on the ground floor of a special offer. All of those options would require intelligence on the part of business leaders. Do any of the people that are around seem like that? I dont think so. Its just by luck these people can wipe themseleves.

On a practical level, how do you unwind a fraud like this? If it is not done right, then all the victims will end up arguing with one another for a piece of the shrinking pie. Second, I agree that if there was ever a poster boy for capital punishment for fraud, it is Madoff. This amounts to financial terrorism. He should be punished accordingly.

"This amounts to financial terrorism..." writes John.

Nice one, John. I might steal the phrase "financial terrorism."

Lauren

Its hard to believe Bernie Madoff's lifetime investors did not know he was somehow a crook. Better returns that everyone else, and how hard it was to get into the club. Most of these investors thought Bernie had a main track to inside information. They all thought Bernie was the best source of all good inside info, how the hell could he get these returns. With a country club of participants.. at the exchange, the SEC.. This would have gone on forever... Bernie just ran out of money.

Look into the SEC... there must be a group who protected Bernie. You know some SEC guys grandmother who has all her money with Madoff.
"He gives such great returns, it helps so many people and charities"

It’s a country club! They’re all guilty! Bernie, the SEC, and investors.

Bernie was such a good man - it is hard to fathom. He gave money to charity and to many Democrats like Schumer, Lautenberg, Spitzer, Hillary and Barrack. Bernie was such a good Democrat. I never thought his donations would get the Senators to make sure the SEC never regulated hedge funds. Chelsea has a job at a hedge fund and she my be NY's next senator.

We were on such a cgolden ride with Bernie. We all knew Bernie was front running his investments through his market making firm but the returns were so steady and good. It makes me so sad. I know people who have lost everything. Bernie please give the money back.

"What now? Let me tell you what now."
Everyone who's seen Pulp Fiction knows what follows for guys like Madoff.

I had an account with "Bernie Made Off" and it wasn't easy to get an account with him.. My father invested with Madoff in the 1960's and until his death two years ago my father lived like a king because of him.. I feel bad about what i lost but i gotta move on..

One of my dad's expressions (which i fucking hated) , its what a salesman, charlatan, magician or a Madoff would say..."You don't sell the steak, you sell the sizzle".

Madoff's scam has reminded me of similar case happened in India in 1992; at that time it was Harshad Mehta who managed to jolt over $1 billion by using fake RFs and BR deals.

Sometimes people cross the limits of honesty and integrity and Madoff is one such person.

Great piece! Makes me think of TV shows, too: First there was "Everybody Loves Raymond", then came "Everybody Hates Chris" and now "Everbody Hates Bernie!"

I have limited sympathy to all those who believed that good ol Bernie was working the system for them. They didn't seem to mind when the mark on the other end was the supposed victim to Bernie's magic - you know front running the trades and other advantages that Bernie would supposedly have. It is their greed that got the best of them where they suspended all logical reasoning except thinking it was Bernie's in that got them the returns

If they bail out the investors, it will be a disaster, but I feel sorry for them. When there are so many sophisticated professionals investing with him, you feel like you should believe they have carried out proper due diligence. It's just like the Wild West. We need strong moral leadership to deal with past lunacy and make the future stable, even if we have to readjust our expectations...

felony fraud in a case such as Madoff's should be considered a capital crime, period, because as folks are bemoaning his indiscretion, someone else is cooking up a new scheme...

Yeah, I'm pissed at Madoff. But these people with tens of millions of dollars losing 3/4 of their money? F$%# them. They deserved it for being so damn greedy. When they are all living on $20,000 a year is when i'll hear their complaints.

In a liquid market, there is ABSOLUTELY NO WAY to continue to make the returns Madoff was delivering. He was lying and everyone bought into it because they are greedy f$%#s.

What I read was that Madoff made his own trades, held the shares he bought, avoided filing disclosures with SEC by claiming he sold the holdings at the end of every reporting period (how unusual is that?) and refused to provide clients online access although he spearheaded electronic trading. I have been so disappointed with how our country treats these cases, but he should definitely not be out on $10 million bail, because it is money that belongs to someone else.

Nina, you are not alone. My family got pummeled by Bernie. Believe me when I say that the family member who made the decision to go in with Bernie had no though whatsoever that Bernie had some sort of unfair advantage. The market was terrifying, there finally was a chance to go in with Bernie, what could be safer than a man with such a consistent track record and who had the blessing and affirmation of the entire industry?

Some of the people who have been invested with Bernie for ages are not people I like. They are not thoughtful people. They are not good people. Many of the people who invested with Bernie, however, are some of the BEST people you will ever meet. People who give their lives to charity. People who don't just give charity as some form of tithing, but who lead simple, non-ostentatious lives, who have spread a great deal of good throughout the world - and not just in money - and who treat all they encounter with decency, respect, and compassion. As self-serving as this may sound, I have lived a life I feel comfortable putting in front of the Great Arbiter in the Sky. I treat my fellow human beings with compassion and concern and have never allocated respect based on economic status, class, race, or anything of the like. My family can't understand why the comments sections in these blogs upset me as much as they do - whether it is the anti-semitism, the lack of thought, the evil delight in the misfortune of many people who have lived virtuous and decent lives - it's all just appalling. I understand the hatred of the rich - heck, I'm a democrat who believes in taxes because I believe we all have a responsibility to our fellow man - but the reaction to this story has just been vile.

I'm afraid many of Bernie's investors actually are people I wouldn't want to spend much time with. But I wish there were a place for those of us who are just decent folk who worked hard to put something away and just hoped to preserve what we had or leave a little more for the children - for my part, the only reason I've ever wanted money is so I can support a family some day - any money beyond that, if I want it, it's so I can give it away to all the charities I care about - but I wish there were a place where we could commiserate unburdened by all this nastiness. People seeking much higher returns and investing with people with much lower credibility have been taken in before, as surely as we have. You all think it's hilarious to point the finger. This man was the former chairman of the NASDAQ. For my family? We'll get by. I guess. He didn't get everything. It's appalling, it's left me in a turmoil of emotions of anger, betrayal, and frustration. But he cleaned out some very good people. And the impact on the charities of this country will be devastating. And this does not just cover Jewish charities, for all the moronic anti-semites out there. This man has unleashed a terrible evil and only a fool thinks the impact will be limited to the very rich.

I am impressed. If I wrote anything called "Why I hate B.Madoff" it would take up too much paper, or RAM, or bandwith. For shame on him.

I don't buy into this article. I'm a 30-year old father of two children and I know.

How much time do you spend when buying shoes for your children? Hours.

How much time do you spend when you want to buy a new car? Days!!!

Why is it then considered normal to spend time and energy on petty things like shoes, pants or even cars, but you blindly trust your entire life savings to someone just because someone told you so??

You got what you deserved.

Watching Mr. Madoff's life -- and livelihood -- unravel on a daily basis, right before my eyes, is both fascinating and shocking. This riveting saga is a Shakespearean tragedy of epic proportions. How such a brilliant, renowned, highly-respected, charitable pillar of the community could plummet to such an ignominious depth is literally breathtaking.

I still can't decide whether Madoff should be pitied, or reviled. One thing seems clear, though; he indulged wwaayyy too often on hefty portions of ego, hubris, and greed.

Fortunately, I'm NOT among Mr. Madoff's investors; nevertheless, I can understand why people trusted him, and I sympathize with their sorrow and loss. Madoff may have self-destructed, but, sadly, his downward spiral resulted in the devastation of countless unwitting others.

People got what they deserved. One clear indication of a person being untrustworthy (in the investment business)? When everyone else in that business sings his praise. Like frush said above "what could be safer than a man with such a consistent track record and who had the blessing and affirmation of the entire industry?". That says it all there. NONE of the people in the banking business are good people. Think of it this way. What kind of person decides to make it their life's work to be around money? The greedy kind. Root of all evil thing hits home right about now, huh?

To add to my comment above, let's be honest. Really honest. Reading comments like "a man with such a consistent track record and who had the blessing and affirmation of the entire industry"...."If you can't trust the former chairman of the Nasdaq with a sterling reputation and philanthropist, who can you trust?"...."Nina Silver.....What a true lady you must be. Your words ring with the truth."....The stock market is EXACTLY...EXACTLY like being in Vegas. There is a Gaming commission (SEC) to watch over the casinos, but it's mostly a free for all. And brokers, investment managers et all are just professional gamblers. Bottom Line. I have met professional gamblers in my life and always counted my fingers after shaking their hands. Any one that thinks the guys on Wall Street are any more than that are delusional. It is my generation that is running companies, banks, etc. And I know how stupid and self-centered we were then. So nothing surprises me now. We have to get over this putting people on pedistal things (lawyers, bankers, etc.). They don't deserve it. That aren't has smart as the common man working day in and day out. I am starting to think that the defination of a successfull Wall Street type is someone who just hasn't gotten caught yet.

I have to underscore the very first principal of investing---diversify. Any person who does a lick of homework on investing should know that. Several posters have mentioned the likelihood that people did more research on buying a car, dishwasher or digital camera then they did on investing with Made-off. Of course I feel sorry for the people who lost their money in this scam--but please--take responsibility for your actions. This country has become a country filled with people who feel entitled and fail to take responsibility for their decisions. The response from some of the victims underscores my point. For what it is worth, take the mulligan and move on. And remember, diversify!

The people who got schemed are mad at Madoff and I understand this but why turn the anger to the rest of the population. Are they looking for sympathy so they can get reimbursed by the government? Is this a publicity stunt to get the rich their money back? Can the rest of the population get what they lost in their 401Ks? I lost my money too but I don't think I am owed anything, especially sympathy. The people who are involed FLY HELICOPTERS to the Hamptons and drive a BENTLY. Check out the website below.

http://www.huffingtonpost.com/nina-burleigh/madoff-in-manhattan_b_150903.html

There is no reason to to single yourself out we all got scamed.

Bob - you can't ignore that as many similarities as there are between the market and gambling, the government does not acknowledge this similarity and does not equate the SEC to the Gaming Commission. That creates a significant difference. And people who walk into Casinos are supposed to be guaranteed a fair game where the Casino doesn't unfairly just walk away with their money. With that as a baseline, they are then free to win and lose money as it occurs. That is the gaping flaw in your analogy. This is more like the Gaming Commission not recognizing that one of their casino operators runs tables where their dealers cheat in the monetary particulars of the game.

CL- take a mulligan? Do you know what a mulligan is, or are you just being intentionally ridiculous? Because there is no mulligan available here. And how many people investing all their retirement funds in a single mutual fund consider themselves diversified if the fund itself is a diversified fund? People are way too eager to use hindsight here and figure out some way that - of course, they themselves are smarter than the victims. Try to use some honesty here, people.

And chill town, who is turning their anger at the rest of the population? What are you talking about? Now the disgusting anti-semitism and the self-righteous "everyone should have known better" and "let's figure out how to spin this to make the victims 100% complicit" and the horrible, nasty glee that people are greeting this story with - yes, that occasions anger. Outside of that, though, what anger towards the population are you referring to and why would we be angry at a run of the mill citizen over this? This doesn't make any sense.

Most of the comments here are downright ugly, and reflective of the growing desensitization of the US population, as well as what I have perceived as an epidemic of callousness and lack of empathy.

I'm not a millionaire, but I doubt any of us would turn down the opportunity to have more money, if employment and opportunity granted us the chance. I doubt any of the armchair 'hate the rich' posters on this board would behave any differently if they suddenly won the lottery and found themselves in possession of $50 million.

I also believe the search for a return on your money is as reasonable as someone with a $10,000 savings account looking for a 4% interest rate. Would you characterize that as greedy or is this just envy raising its ugly head??

These people weren't looking for a hedge fund or crazy returns, from what I can tell. However, there is a seething resentment which has been building on the part of the US population, and I fear that we could see a sizeable reaction to perceived inequalities and advantages.

The U.S. is no longer a capitalist country, or the land of opportunity. It has quickly morphed into an increasingly polarized population on the verge of an all-out class war, driven by the kind of long-supressed explosive emotions which led to the French and Russian revolutions.

Woe to anyone who appears to have a little more, the sicle is coming to mow all down to size. I hope I'm wrong, but I don't think so

Well said, Lauren. We had family friends who lost just about everything after entrusting their retirement savings with Madoff. And how about those charities who have to shut down or lay off most of their employees now after trusting him with their money. It's really twisted.

I was thinking about it...the problems of where to park $10MM or more, (assuming one is lucky enough to have amassed such a sum), are not trivial. Given today's precarious banks, would you put it in a savings account? Hedge funds are so risky, and gold so volatile...

If I had such a sum, and a trusted friend offered to introduce me to a well regarded, low key, retired Nasdaq chairman who also handled the accounts of such celebrities Steven Spielberg and Mort Zuckerman, I'm not sure my first reaction would be one of extreme suspicion. Fortunately or unfortunately I'm not in a position to ever find out, but I have empathy for those who have been victimized, as I can see how it could happen.

Of course now, after this bombshell, we will all be far more suspicious of everyone, and I imagine even the most honest and truly decent money manager will be assumed guilty of possible fraud, and monitored like a would be shoplifter. After this, investors will (hopefully) check to see the reputation of a firm's auditor and compliance officer. After this, we will diversify...assuming we have any money left to diversify with. After this, we'll be smarter...we hope.

However honestly, I doubt that most of us would have asked all the hard questions ahead of time. Most people, until this year, were happy to go with a solid reputation and join a clientele which could easily be characterized as 'smart money". In addition, until recently investors had gotten their money back quickly when they had asked for a redemption.

2008 has, however, ripped the mask off many trusted concepts and institutions...I suppose it is fitting that 2008 go out with one final, explosive scandal to ensure that not one segment of the population escapes unscathed. After this "annus horribilis" we will all be alot more cynical and suspicious going forward...

In addition, a truly frightening thought is this: if someone with as sterling a reputation as Bernard Madoff's has been exposed by the rapidly receeding tide of the world markets, how many others will soon join him in disgrace? I fear this is just the tip of the icebert, given the extreme leverage, search for oversized profits and heated competition for clients of recent years

At least Madoff had a moment of conscience, and turned himself in...his younger counterparts may only come out of the closet when smoked out by the next leg down for the market.

Heaven help us

"George
December 16, 2008 10:26 AM
Its not rocket science. One should only invest in what one understands. Buffett has being saying that freely for years."

What is so messed up about these easy, breezy maxim that this smug poster so all-knowingly tosses out there is that if this were true, do you know what would happen to the entire stock market? It would crater - and I don't mean crater like we've seen recently - I mean fall apart like Dow 1,000 fall apart. Do you know why? Because if people only invested in what they understood, basically 99.9999999% of investors would have to exit the market. They would have to pull all their cash out. Do you think these people know how to read a balance sheet? How to assess a company's actual prospect? How to understand the relationship between a company's underlying fundamentals and stock price? Get real. And all the money from people who CAN'T do any of these things is necessary to keeping stock prices afloat at even their currently depleted levels. People don't want to be honest about how things really are, but the truth is the truth.

So spare us your all-knowing pronouncements, please.

From New York to Geneva, corruption is rampant and complex on Wall Street.
-
http://pacificgatepost.blogspot.com/2008/12/is-madoff-really-anomaly.html
-
MADOFF IS NOT SO UNIQUE

such vitriol, aren't we talking about high brow gambling? people only want and expect to win! bad sportsmanship as far as i am concerned.

Had dinner with an old friend some two months ago wherein he told me that he had about $2 million, his life's savings, invested with an advisor named Bernard Madoff. I told him that I am well familiar with Madoff's reputation, but am also well familiar with Madoff's arrogance & hubris when inquiring about his trading.

Having been in the managed money arena since the 1970's, I well know this type of money manager, someone who exchanges his ego for his claimed trading performance, and who will surely blow up sooner or later.

Most algorithmic, black box groups have at least a half dozen quants who are always available for social interaction, enjoying swapping theories with their fellow quants in the industry, sort of an Einstein Social Club of sorts. And, typically, a few of our group are always looking to leave their employment for greener pastures, or to set up their own firm. Such was never the case with the alleged Madoff crew because none ever existed! I never met one nor heard of any.

Well, back to the dinner . . . I told my friend that the 7% to 12% typical annual return, and years back 20%+ on occasion he said, was lousy, wherein my fully funded group, utilizing our own proprietary algorithms, have been averaging 60% per annum without leverage, and upwards of 300%+ every 40 trading days [two months] utilizing our very intensive day trading algs [w/a dozen hi-end workstations & a "supercomputer"]. But we trade only our own monies, have no clients nor solicit for same, remain totally unknown and wish to remain so. Saying that, I felt sorry for my friend and offered to trade his funds for him, gratus, even guaranteeing him at least a 40% per annum return, with such return & his beginning equity escrowed with my money at any bank of his choice, in advance, just so I could prove my point I guess. His response was, "Naw, this guy Madoff has been trading for 19 years for my late relatives who left me their accounts as an inheritance, so I'm staying with Madoff." I told him that he's a dope, but it's his funeral.

Just this week I received a phone call from my old friend, he said, "I'm broke, will soon be homeless, what can I do?" I told him, "I told ya so! But don't worry, I am going to make you whole out of my own pocket. It will be worth it to me to have proven my point."

Aloha Mama said:
"Most of the comments here are downright ugly, and reflective of the growing desensitization of the US population, as well as what I have perceived as an epidemic of callousness and lack of empathy."

You are correct to a degree. And my comments may be such. But I think that part of the problem with Wall Street (and other authority figure) types is that they count on us being civil and not raising fuss. Being blunt and forceful is the only way to make your point so people realize it. Everyone wants to think that there are mostly good people on the street with a few bad apples. But the business of Wall Street (as it stands now, not the original idea) is now built on bilking the investor to feather one's own nest. Watching the news this AM, I saw where banks and investment companies want to use alot of their GOVT bailout money to give themseleves huge bonuses for "staying with the company through hard times". Retention bonuses?!?! You want to keep the doctor that cut off your (fill-in-the-blank) by accident so he could charge you and move on? Hey, I have a broker, really. And while he has one of the most sterling reps, and has helped my in-laws for years, I still don't trust him. Never will. Your job is to take others money so YOU can gamble it and keep some of the vig? How can you trust someone like that. I think that Wall Street has ruined our country. It has made some very very wealthy, but at the expense of most of the rest of the country. And now they want us to pay for it with our tax money. Like a rich man driving drunk, hitting you with his car, and then sueing you to fix the dent in his hood and to remove the blood from his headlights.

I'm with AgentG. The culprit isn't Bernie Madoff; it's the deregulatory climate that allowed him to flourish. Most of us supported this climate. Nuff said

Lauren -- I'm sorry to hear about the losses of your family member, but I have to say I'm surprised that anyone would invest more than $500,000 with a single firm, given that that's the limit on how much the Securities Investor Protection Corp. will pay out for each account if a firm goes bust.

Certainly, with all the bank instability we've had, people were aware that they shouldn't have more than $100,000 in any one bank, because that was historically the limit that the Federal Deposit Insurance Corp. set for depositor reimbursement, though this was recently raised to $250,000 during the ongoing financial crisis.

Frankly, I'm surprised how sophisticated investors could be so ignorant about the limits on federal protection against securities losses due to a firm being liquidated.

Nice article that I think captures many people's sentiments about this guy. Not everyone has time or the financial acumen to scrub their financial statements, and to think that this man took advantage of this, even with his own family members, is stunning.

Wonder where all that money went? Perhaps, through his association with Yeshiva University, to Israel?

Wow, this blog entry was quite uninformative. No new news, just an obvious sentiment about an already sensational story.

Common sense usually helps. Many years ago my father came to me with an opportunity for an investment with one of his trusted business associates. Details were sketchy but the historical returns were solid and climbing with plenty of references. I declined and advised him to do the same since we could not figure out how those returns magically happened.

I am glad and my father is very glad we passed on this amazing opportunity. We still have our hard earned money as this apparent fraud continues to unfold.

Morale of the story, ask questions and be fearful if the answers illicit many more questions without apparent answers.

Why do we all go to work?
To earn money, unless your lucky enough to enjoy it.
Therefore, if we give our occupations our most precious asset, which is time, does it not make sense to give some time to look after the product of our toils.
We all have a duty to find out what happens to our assets after we have earned them.

I can remember back in the early 2000 Mr. Madoff came to the investment shop I worked with at the time and asked for money. Most of us just looked around the table afterwards saying "I don't get it" or "we MUST be just not that smart" because none of his strategy made sense at the time. We declined to invest with Madoff but continued to view the firm as someplace with which we did not want to do business. I can go back even further into 1993 when I plugged into his market making operations and took good use of his "auto-ex" feature that was a tiered 3rd market liquidity provider. Even at those early times I knew personally that there wqas no way a firm could face the rest of the street and make money committing capital like that. Madoff had some great people working for him in the early days of market making and thats how he made his name. Friends and neighbors were jujst swindled by a really bad guy. Fund of Funds invested in Madoff didnt live up to thier fiduciary responsibilities and should be prosecuted as well.

We should never abdicate personal responsibility for what is in our care. In this case, it happens to be money. I'm very surprised that so many were irresponsible to such an extent with their personal and/or corporate funds.

I have invested in a high-risk technical day-trading strategy. I was given the trades for the next day and checked the results on a daily basis. I always stayed ontop of what was happening in my account.

It is complete folly to give away one's power by burying one's head in the sand, and then pleading ignorance. This is a wake-up call for all of us to be responsible for oneself in a new way.

Let's get this right-that is $100,000,000.00 x 50. At times, one should consider MORE than a persons religious affiliation!
Nothing more than a "big time" criminal.
The SEC was aware of "wrongdoing" over a decade ago-others will have to answer for this lapse of oversight between Wall Street and the SEC; maybe separate bedrooms are in order!!!

I am a senior lady and I have a small amount (under 100,000) in the bank and I feel like a millionaire right now.

I think the author is an anti-Semite. Disgusting!

Most of the workers in the USA are involved in a ponzi scheme. It's called Social Sercuity.

I seems unlikely that any single person or group have got their hands on any large chunk of the $50Billion.So its likely that most of the money will have been redistributed to many thousands or millions of those less fortunate.
Its hard to feel that much sympathy for individuals who were happy to sit on their capital and just earn 12% a year for doing nothing.
Keep the sympathy for those the charities would have been helping.

The SEC allowed this to happen. Things better change. If they keep up like this eventually people will wise up and take matters into their own hands. I don't blame Madoff; there are scum like him everywhere in every industry. Who do I blame? I don't know enough about all the back room deals to know who to blame. I just know power corrupts pretty much anyone.

Remember this? In June of 2005 Bill Donaldson was fired at Chairman of the SEC, primarily for advocating for the registration of hedge funds. Donaldson was a loyal Republican, close Bush family friend and former CEO of a major corporation. On his last day in office Donaldson voted with two Democratic nominated commissioners to require that hedge funds register with the SEC, an action that was later overruled by an appeals court. Sadly, Donaldson was one of many competent and effective government officials that have been systematically removed from the current administration. He was replaced by a California congressman who appears to have neither the background nor courage to fulfill this most important role. That guy was Cox and who McCain infamously said he would fire. I think he was onto something. I would love to know what McCain knows about Washington and Wall St. I mean c'mon, are we infants or what?!?

Why Are we invited to feel sympathy fpr people who had so much wealth.. they had plenty to salt away with a con merchant... What goes around comes around.

Bernard Madoff should spend the rest of his life in prison. Someone convited of armed robery could face up to 10 to life in prison. Its unfair to the American people who are barely making ends meet in our hurting economy to be taken advantage of by coporate criminals

TARP FOR MADOFF VICTIMS!

Tough Snougies dude!!! How many people in the US can make enough money to invest in a hedge fund - Really! Trust your fininacial advisor - Get real. Maybe everyone should see Rocky 5 and look what happen to him and his accountant. That is a movie I saw when it came out as a child and it left an indealable mark on my brain on who you can realllly trust with your money. I'm so happy this is happening with the hedge fund industry right now. They didn't want oversight, now you must reap what you sow!

Nina Silver, I agree with everything you said. I've been shocked to read how many people are attacking the individual victims. I wish you well and hope that somehow you can recover some of your losses.

Jake, I do hope you make good on your word to your friend. That would be an amazing thing to do.

Madoff should spend the rest of his life in prison...and not a cushy federal one either. That probably won't happen unfortunately.

Lauren

I like your comment that 90% of people are too busy to manage their own money. Well what about your retired relative. What was he doing with his time? It is certainly unfortunate people lost money with Madoff. However I know people who lost their home because of excessive medical bills, layoffs, and other events that they could not control, more so than simply being lazy with their money and sticking it all in one place. There are all kinds of sob stories these days, and crooks have been around forever, whose fault is it really that some of Madoff's investors were wiped out? Mr. Madoff will pay, and so will your relative. Lessons learned.

"But most people-I’d venture to say at least 90% of us-don’t have time to manage our money or to keep tabs on the “professionals” we hire to do just that."

It doesn't take much time to open an account at The Vanguard Group and put one's money into a Target Retirement Fund. One doesn't need a "professional" to do that. It's easy and anyone can do it.

This scam happened to me 10 years ago and my family is still feeling the affects after all this time. The judge knew it was a scam but just could not see his way to put the woman I invested with in jail. She is still out there with her divide and conquer scam.

Bye Bye Ms. American Lie. That is what my husband and I said almost four years ago when we left the USA forever. We got tired of getting the shaft from univeristies we attended, jobs we worked really hard doing (we are both teachers), apartments we never got our down payment from even though we left spotless apartments, police rackets-especially in Miami, doctors who double billed people, medical insurance companies who try not to pay people, and who keep raising their rates so CEO's can take home a mint while people die because the company won't pay for their needed care, incorrect telephone bills, and many other horrible scams that were deguised as legal. Believe me, Madoff is only the tip of the iceberg. It's time for a change. I hope Americans wake up to the fact that the country is a horrible rip off!!

"An eye for an eye, a tooth for a tooth"...

It's in the Bible...

It's in Hammurabi's code...

So like he shamelessly took from others, take his hands from him

Chop-chop

I don't trust ANYBODY with my money! No, I do not stash cash under my mattress, but I am still very cautious. I WILL ONLY belong to a credit union. I don't trust big name banks for various reasons. My husband has been upset with me for years for not participating in the 401K program at work. I refuse to do it, and feel bad for those that were burned by Bernie Madoff. I am only 35 years old, but I have learned that, "Everything that glitters is not gold."

20 of my relatives including my father had an account with Madoff.. My father is 63..raised three kids after my mom died. Finally he retires two years ago.

My father now has less than a week to find a new place to live since he can't pay the mortgage. All of my other relatives are hyperventalating too with the uncertainty and the realism of how much they have lost.

I don't believe there's a residue of humanity in Bernard Maddoff.

May the hounds of hell devour his soul!

Jeffery, to bad about your Dad.What concerns me about your father and so many more (I've read about) like him- If they had money to invest in Madoff, or the stock market in general (which is like going to Vegas, which has been stated so well in previous posts), why not pay off the mortgage first? Then, no matter what happens, no one can take your shelter away, unless you don't pay your real estate taxes...I'll tell you why-GREED!!!!!!!!!!! WHy pay off your mortage, you'll lose your tax deduction (which for most people, he REAL savings are pennies on the dollar, if you truly understand Sched. A 1040)...or your mortgage interest might be 7 %, but you believe you can earn more in the stock market- yeah, maybe in theory-FOLKS, PAY OFF YOUR HOMES FIRST- forget about the perceived tax savings, they ain't real. Once you've paid off your homes, if you want to gamble for fun, call MADOFF, INVEST IN THE STOCK MARKET, GO TO VEGAS, PLAY THE LOTTERY, at least you've gota place to sleep and call your own.

If Bernie receives any more than a token fine (paid by a 'friend' out of whose funds?) and/or, subject to his lifespan, completes more than seven years jail time, then you can call me Meyer!

It is easy to criticize innocent, middle class workers who invested in Madoff fund.
He was the former chief of the NASDAK and had an impressive resume
Why not blame the innocent patient then who sees a Quack doctor with impressive diplomas in his wall.

How much checking and suspicion should one have.

It is true though that the realestate mortgage debacle was due to a Ponze scheme where over the years less and less qualified borrower bought homes, then packaged into Credit Default Swaps resold to Walstreet with AAA credit worth. Then the Ponze scheme unfolded when speculator at first could not resale ther investment home they bought without down payment, capital.....
Unbelievable.

I have to agree that most investors knew he was ripping off someone--they just didn't realize it was them.

Would you invest with a crack dealer as long as you didn't live in that neighborhood and you 'thought' you had some kind of insurance if the dealer got busted by the DEA? Probably not.

But as long as you don't really know what the money is invested in--then it's okay? That's called 'Denial'.

If you are invested in a business then you are the owner. You are responsible for the good and bad that business does. Choosing to not pay attention does not relieve you from moral culpability.

We are angry at Bernard Madoff becuase he is selfish, amoral and unconcerned about the consequences of his actions on his fellow man. I think he represents what America has become.

The solution is not to wipe out the Bernard Madoff's in the world. They only have as much power as we allow them.

THEY ONLY HAVE AS MUCH POWER AS WE ALLOW THEM.

The solution is to wipe out the Bernard Madoff's within ourselves.

We've allowed large banks to open up checking franchises under different brand names to rip off the poor, uneducated and powerless with PayDay Loans. Why do we allow this? Because of the Bernard Madoff within us.

There's much we can do start getting rid of the Bernard Madoff within us. Perhaps now our love affair with all things material will subside. Perhaps America will spend a little time reflecting on some deeper values.

Do I think the Chinese have it right? Take him to a crowded stadium and dispatch him in front of thousands of onlookers. No, that's hardly progress. (Although in all seriousness, even in 2009, the Chinese would not hesitate to do this to white collar criminals)
Still, I believe Madoff should be made into some sort of very public example.
One thing that has been missing in our society has been a sense of shame.
Maybe we should resurrect that Victorian notion again. If there is a way to make an example of him so that others would be fearful of a similar fate then maybe we're getting somewhere.

It is devastating to hear that this Ponzi schemer Bernie Madoff also victimized schools. Poor schools, they don’t have their money to provide their students a better educational services. Everyone has been a victim or at least targeted of some sort of rip-off at one point in their lives from schools to charities to foundations. Rip-off has been around for quite some time that even during the 1920’s, it was already evident. They certainly aren't slowing down, and people look into online payday loans to fix the damage, at times. The maxim to bear in mind is that if it sounds too good to be true, it usually is. Investments are a prime target of scam artists, such as scam artist Bernie Madoff, or the folks that ran Enron. You must take care to guard your investment portfolio, and keep it safe from some scam artist who is trying to get you to fall for a rip-off.

Doing a simple caculation over lets say 10 years, Madoff did not rip off 60 billion. Madoff at the most ripped off 19 billion but the Feds think they can over time recover 10 billion.
So Madoff only ripped off 9 billion. This is equlivant to Texan Ponzi scam tycoon Stanford's.
Lets see if Stanford gets 150 years.

Being a victim of another scam artist..... and nobody knew about it ? ) However I dont really hate him, but rather blame the system that allows these rats to operate and lead to all sorts of situations such as suicide and remote control homicide of fellow citizens.
My family worked very hard in South Africa in order to provide a decent home for our family, and now, here comes a crazy rat, let on the loose, to rob us of our dignity, integrity and access to the simple things that makes us different from a stray dog.