Fraud of the era: NY investor Bernie Madoff

Bernie Madoff by Yan Pei-Ming at San Francisco Art Institute - 159
Originally uploaded by Steve Rhodes

In relating the Glengarry story and the culpability of Mitch and Murray, this class notes the crimes of the infamous Bernie Madoff.

Bernard Lawrence "Bernie" Madoff (1938) is a former American businessman, stockbroker, investment advisor, and financier, says Wikipedia.

He is the admitted operator of a Ponzi scheme that is considered to be the largest financial fraud in U.S. history.[4]

In March 2009, Madoff pleaded guilty to 11 federal felonies and admitted to turning his wealth management business into a massive Ponzi scheme that defrauded thousands of investors of billions of dollars. He is serving a sentence of 150 years.

The amount missing from client accounts, including fabricated gains, was almost $65 billion.

On December 10, 2008, Madoff's sons told authorities that their father had confessed to them that the asset management unit of his firm was a massive Ponzi scheme, and quoted him as describing it as "one big lie."[18][19][20] The following day, FBI agents arrested Madoff and charged him with securities fraud.

The U.S. Securities and Exchange Commission (SEC) had previously conducted investigations into Madoff's business practices, but did not uncover the massive fraud.

Since Madoff's arrest, the SEC has been criticized for its lack of financial expertise and lack of due diligence, despite having received complaints from Harry Markopolos and others for almost a decade. The SEC's Inspector General, H. David Kotz, found that since 1992, there were six botched investigations of Madoff by the SEC, either through incompetent staff work or neglecting allegations of financial experts and whistle-blowers.

Madoff apologized to his victims, saying, "I have left a legacy of shame, as some of my victims have pointed out, to my family and my grandchildren. This is something I will live in for the rest of my life. I'm sorry." He added, "I know that doesn't help you," after his victims recommended to the judge that he receive a life sentence. Chin had not received any mitigating letters from friends or family testifying to Madoff's good deeds. "The absence of such support is telling," he said.

On the morning of December 11, 2010—exactly two years after Bernard's arrest—his son Mark was found dead in his New York City apartment. The city medical examiner ruled the cause of death as suicide by hanging.[114][115][116]