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Securities and Exchange Commission inspectors have been working overtime to go through the records of Bernard Madoff and his investment firm. Bloomberg News reports that investigators "found evidence he ran an unregistered money-management business alongside his firm’s brokerage and investment-advisory subsidiaries." Also, "Investigators are still trying to figure out where customers’ money went," as Madoff's estimate of $50 billion in losses may be "roughly accurate."
Madoff, the 70-year-old former chairman of Nasdaq, confessed to employees—including his sons—that his well-performing investment firm was actually a Ponzi scheme, as the returns to earlier investors were taken from money of new investors. Madoff allegedly oversaw the entire operation from the 17th floor of the Lipstick Building on Third Avenue (pictured), two floors from his company's trading floor. The NY Times calls the floor" Where Wealth Went to Vanish," and notes another big question is "how one person could have pulled off such a far-reaching, long-running fraud, carrying out all the simple practical chores the scheme required, like producing monthly statements, annual tax statements, trade confirmations and bank transfers."
The head of Seabreeze Partners, a Palm Beach and NY hedge fund, told the BBC, "It appears that at least $15bn of wealth, much of which was concentrated in southern Florida and New York City, has gone to money heaven." In Palm Beach, where many of Madoff's clients were recruited, one woman explained to the Times how to pronounce the scamming investor's name: "Made off. You know, like he made off with all our money.”
There are many examples of Madoff's victims. Some that were mentioned today: The NJ couple who just sold their house and put their profits into their Madoff account; HSBC, which may have lost $1 billion; and charitable organizations run by Daily News owner Mort Zuckerman and director Steven Spielberg.
Clusterstock had guessed Madoff never intended to dupe anyone: "In the beginning, he probably produced the returns he said he produced. Then, somewhere along the line, he probably had a bad month or two that he thought he could quickly offset with a strong one. So he fudged the results and then got back to even... He probably did this a few times until, eventually, the recovery didn't get him back to even. Instead of admitting this, however, he kept it up in the hopes that someday it would--and in the hope that he would be able to preserve his life and reputation."
And for some reference, CityRoom covers the original Ponzi scheme from Charles Ponzi.
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a sucker and his money are soon what?
Wow, this Madoff's got some chutzpah.
He better hope one of his high-powered victims doesn't hire someone to "take care" of the problem...
man, if i found out this fucker screwed me over this bad, especially if i was in my 70s and suddenly without any retirement funds, i'd "take care" of the problem my damn self
"at least $15bn of wealth, much of which was concentrated in southern Florida and New York City, has gone to money heaven."
Hmmm, New York City, Southern Florida... I'm going to go out on a limb here and guess that most of his clients weren't Episcopalians!
lol@tsol
I know someone in jail for 9 years for ripping off approximately $15 million. Can I assume that Madoff will get 30 times that sentence, or will he use all of this stolen money to buy off the judicial system? He deserves to fry.
in the other thread people were saying that this is somehow the investor's fault. I mean, the guy was delivering detailed monthy statements about their money. How careful do you have to be these days? This is sad because things like this are removing the idea of any investment at all as a sound practice for wealth holdings.
You can only trust your mattress these days, I guess.
another big question is "how one person could have pulled off such a far-reaching, long-running fraud, carrying out all the simple practical chores the scheme required, like producing monthly statements, annual tax statements, trade confirmations and bank transfers."
In the same manner one person pulled off the Kennedy assassination. Sheeesh!
He'd better hope for a long sentence in maximum security. There's going to be a lot of people gunning for him outside.
"How careful do you have to be these days?"
How about the old saying "not putting all your eggs in one basket" like these folks. Most if not all individual investors from what I've read put the bulk of their fortunes into this one man.
If the Jews are wrong and there is indeed a hell, there's a special little place reserved for this scumbag. How can you knowingly gut social justice and other philanthropic organizations and sleep at night?
"A ponzi scheme that bears a Lipstick's traces, an airline ticket to offshore account places..."
From articles I've read, the monthly statements were anything but detailed.
""in the other thread people were saying that this is somehow the investor's fault. I mean, the guy was delivering detailed monthy statements about their money. How careful do you have to be these days? This is sad because things like this are removing the idea of any investment at all as a sound practice for wealth holdings""
I know various people who were directly affected including those working at North Shore - LIJ and Yeshiva University (which includes Albert Einstein College of Medicine). They stole 5 million from North Shore LIJ and I don't know offhand the figure for Yeshiva University.
I say Madoff should face a public hanging for what he did. I would personally conduct the hanging.
In China he would have been executed on the spot.
Is there a Google Map for money heaven?
http://www.necn.com/category/32/18912
McCain said he would have fired Cox. Bush kept him on and then this scandal which was known earlier than reported was looked the other way on.
The SEC HAS FAILED and CHRIS COX STILL HAS NOT BEEN FIRED.
Wait til the story about the 700B Ponzi scheme breaks.
mtauser: Maybe you missed it when McCain first made that statement.. the President doesn't have the power to fire the SEC chair or any of the other commissioners.
I'm still not clear how this worked. Don't you think some of his employees would have been clued into this? If they are an investment firm that doesn't actually invest the money it takes in, wouldn't someone internally raise an eyebrow? It says he prepared "monthly statements, annual tax statements, trade confirmations and bank transfers." Were these prepared soley by him??? How many people were truly involved?