Bernie Madoff, mastermind of the world’s largest fraud, died at the age of 82 on April 14. He is survived by his wife Ruth and their grandchildren. Madoff’s death sparked international news due to the nature and extent of his financial crimes. Bernie Madoff was once a financial elite in New York.
He was regarded as one of the world’s best investors. For decades, he swindled money from family and friends. No one was safe from his Ponzi scheme. His clients believed that Berne Madoff was investing their funds into the stock market. In reality, their money was being funnelled into Madoff’s bank account at JP Morgan.
Madoff’s crimes affected rich, middle-class and working-class families. Thousands of investors, without knowledge of how stock markets operate, were conned into giving their life savings over to Bernie Madoff. By all accounts, he lied to people with ease. Although, it was noted, by CNBC special correspondent Mark Cohn, that Bernie Madoff was not charismatic or particularly outgoing.
He appealed to his investors because he never promised too much. Madoff did not give his clients exceedingly high expectations. He promised high returns that were reasonable enough for people to believe.
Madoff used money given to him by new clients to pay off his old clients. He said their returns were very promising in the stock market. By all accounts, Madoff never showed sympathy for his crimes. He bought extravagant mansions and penthouse apartments across the United States. His family enjoyed lavish vacations at the expense of his investors. The Madoff family was famous for their wealth and luxury during the height of the Ponzi scheme.
Madoff’s victims were not the only ones who suffered as a result of his actions. In 2010, two years after Madoff’s fraud was discovered, Mark Madoff, Bernie’s eldest son, committed suicide in his New York apartment. His wife, Stephanie Madoff, believes that the weight of his father’s crimes weighed heavily on his conscience. In 2014, Andrew Madoff, Bernie’s only remaining offspring, died after a long and arduous battle with cancer. Andrew admitted his father’s crimes affected his health.
Many years before Madoff admitted his crimes, Harry Markopolos blew the whistle on the massive fraudulent scheme. Markopolos is a financial fraud investigator and forensic accountant who investigated Madoff’s unregistered hedge fund. In the late 1990s, Markopolos worked at a Boston investment firm. His boss told him about Madoff’s financial investments and how successful they were.
Markopolos was asked by his boss to find out how Madoff was accomplishing colossal returns so their firm could copy him. In 2000, Markopolos took his findings to the Boston office of the Securities and Exchange Commission (SEC). He presented evidence that Madoff was a fraud. Almost nothing was done about it. By 2008, Markopolos had submitted evidence to the SEC multiple times. He claims SEC staff did not thoroughly investigate his claims.
The biggest financial firms in the world did not invest in Bernie Madoff. Markopolos says this is because hundreds of people who worked in finance suspected or knew that Madoff’s dealings wire fraud. People who understood how stock markets worked did not go near Madoff’s hedge fund.
Mark and Andrew Madoff never made peace with their father. They told their mother, Ruth, not to visit Bernie Madoff if she wanted to have a relationship with her grandchildren. When they were children, Mark and Andrew, looked up to their father. He was already a well-known investor on Wall Street.
In 2008, when the financial crisis began, Bernie Madoff confessed to his family that his entire career as an investor had been a lie. He revealed his Ponzi scheme and asked them to give him a week to arrange his affairs. Almost immediately, Mark Madoff contacted his father-in-law, a well-known litigator, so that they could turn Bernie Madoff in.
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