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Wow.

Bernard Madoff Arrested Over Alleged $50 Billion Fraud
BERNARD MADOFF, $50 BILLION, SEC, FBI, FRAUD, CRIME, WALL STREET TRADER, PONZI SCHEME

Bernard Madoff, a longtime fixture on Wall Street, was arrested and charged Thursday with allegedly running a $50 billion Ponzi scheme, U.S. authorities said.

The former chairman of the Nasdaq Stock Market who remains a member of Nasdaq OMX Group's nominating committee, is best known as the founder of Bernard L. Madoff Investment Securities, the closely-held market-making firm he founded in 1960.

But the alleged fraud involved a hedge fund he ran from a separate floor of the building where his brokerage is based.

Madoff told senior employees of his firm on Wednesday that ''it's all just one big lie'' and that it was ''basically, a giant Ponzi scheme,'' with estimated investor losses of about $50 billion, according to a criminal complaint against him.

A Ponzi scheme is a pyramid-type swindle in which very high returns are promised to early investors, who are paid off with money put up by later investors.

Prosecutors charged Madoff, 70, with a single count of securities fraud. They said he faces up to 5 years in prison and a fine of up to $5 million.

''Madoff stated that the business was insolvent, and that it had been for years,'' Lev Dassin, acting United States Attorney for the Southern District of New York, said in a statement. Authorities said that, according to a document filed by Madoff with the U.S. Securities and Exchange Commission (SEC) on Jan. 7, 2008, Madoff's investment advisory business served between 11 and 25 clients and had a total of about $17.1 billion in assets under management.

'Unfortunate' Set of Events, Attorney Says

''Bernard Madoff is a longstanding leader in the financial services industry,'' his lawyer Dan Horwitz told reporters outside a downtown Manhattan courtroom where he was arraigned. ''We will fight to get through this unfortunate set of events.''

A shaken Madoff stared at the ground as reporters peppered him with questions. He was released after posting a $10 million bond secured by his Manhattan apartment. The SEC filed separate civil charges.

''Our complaint alleges a stunning fraud—both in terms of scope and duration,'' said Scott Friestad, the SEC's deputy enforcer. ''We are moving quickly and decisively to stop the scheme and protect the remaining assets for investors.''

The SEC said it appeared that virtually all of the assets of his hedge fund business were missing.

Madoff had long kept the financial statements for his hedge fund business under ''lock and key,'' according to prosecutors, and was ''cryptic'' about the firm.

Bernard L. Madoff Investment Securities has more than $700 million in capital, according to its Web site. It is a market maker for about 350 Nasdaq stocks, including Apple, eBay and Dell, according to the Web site.

The Web site also states that Madoff himself has ''a personal interest in maintaining the unblemished record of value, fair-dealing, and high ethical standards that has always been the firm's hallmark."

 

[Hootie]

What the hell...

 

[Tarazet]

I seriously had to read this four times. That takes the fucking CAKE.

 

[Dan]

Prosecutors charged Madoff, 70, with a single count of securities fraud. They said he faces up to 5 years in prison and a fine of up to $5 million.

Ah, white collar crime...

 

[faceless007]

That's not surprising at all.

 

[Crayon Shinchan]

Really. We need a punishment commensurate with the crime.

Maybe something like not only executing him, but his relatives to a 3rd degree.

That is, we execute his immediate family, his counsins, aunties and uncles, and the brothers and sisters and their families, of his grandparents.

 

[avaya]

The balls.

You have to have fucking giant balls to pull this off.

Holy shit. :lol :lol :lol

 

[Tarazet]

If you need any more proof that the financial system needs a MASSIVE oversight overhaul, this will do it. This ought to be a turning point for the whole fucking shebang.

 

[X26]

jesus are ethics classes not mandatory in U.S schools or something

 

[Corwood Rep]

This sort of institutionalized corruption is breathtaking in its scope and cojones in the same way it's enjoyable to see a bank heist go unsolved, but at the same time, OH MY GOD.

 

[speculawyer]

''Madoff stated that the business was insolvent, and that it had been for years,'' Lev Dassin, acting United States Attorney for the Southern District of New York, said in a statement. Authorities said that, according to a document filed by Madoff with the U.S. Securities and Exchange Commission (SEC) on Jan. 7, 2008, Madoff's investment advisory business served between 11 and 25 clients and had a total of about $17.1 billion in assets under management.

How does one pull this off alone? There must be other people involved.

 

[StoOgE]

I've got a whale!

 

[speculawyer]

If you need any more proof that the financial system needs a MASSIVE oversight overhaul, this will do it. This ought to be a turning point for the whole fucking shebang.

Well . . . to some degree, who cares in this case. Hedge funds are unregulated entities that are only available to rich people. You and I can't invest in them. So a bunch of rich people invested in an unregulated fund . . . . well, Caveat emptor. They didn't have to invest in such an unregulated fund.

 

[daw840]

Really. We need a punishment commensurate with the crime.

Maybe something like not only executing him, but his relatives to a 3rd degree.

That is, we execute his immediate family, his counsins, aunties and uncles, and the brothers and sisters and their families, of his grandparents.

Yeah.....That's retarded. Sure he deserves to be punished, IF this is true. Remember, here on GAF, he is guilty until proven innocent.....wait

 

[ZAK]

Well . . . to some degree, who cares in this case. Hedge funds are unregulated entities that are only available to rich people. You and I can't invest in them. So a bunch of rich people invested in an unregulated fund . . . . well, Caveat emptor. They didn't have to invest in such an unregulated fund.

Replace "rich people" with, say, "investment banks."

 

[GuyIncognito]

Replace "rich people" with, say, "investment banks."

more like, replace "rich people" with "fund of hedge fund managers," the majority of who's clients are university endowments, pension funds, etc. Most of his managed money probably came from institutional investors like pension funds, not wealthy individuals. This is bad for obvious reasons.

 

[dark steve]

jesus are ethics classes not mandatory in U.S schools or something

if you listened to our conservative talk radio/pundits, you'd realize that the US public school system is an atheistic hell in which students are never taught right or wrong and can't even have teacher-led class prayer

 

[LJ11]

Posted this in Konex's thread, seems like this thread is more active. Good, old as dirt, article on how suspect his strategies were. He used his Jewish ties to rip off more Jews, Yeshiva University pulled all available info on Madoff, as if he never existed.

Two years ago, at a hedge-fund conference in New York, attendees were asked to name some of their favorite and most-respected hedge-fund managers. Neither George Soros nor Julian Robertson merited a single mention. But one manager received lavish praise: Bernard Madoff.

Folks on Wall Street know Bernie Madoff well. His brokerage firm, Madoff Securities, helped kick-start the Nasdaq Stock Market in the early 1970s and is now one of the top three market makers in Nasdaq stocks. Madoff Securities is also the third-largest firm matching buyers and sellers of New York Stock Exchange-listed securities. Charles Schwab, Fidelity Investments and a slew of discount brokerages all send trades through Madoff.

But what few on the Street know is that Bernie Madoff also manages $6 billion-to-$7 billion for wealthy individuals. That's enough to rank Madoff's operation among the world's three largest hedge funds, according to a May 2001 report in MAR Hedge, a trade publication.

What's more, these private accounts, have produced compound average annual returns of 15% for more than a decade. Remarkably, some of the larger, billion-dollar Madoff-run funds have never had a down year.

When Barron's asked Madoff Friday how he accomplishes this, he said, "It's a proprietary strategy. I can't go into it in great detail."

Nor were the firms that market Madoff's funds forthcoming when contacted earlier. "It's a private fund. And so our inclination has been not to discuss its returns," says Jeffrey Tucker, partner and co-founder of Fairfield Greenwich, a New York City-based hedge-fund marketer. "Why Barron's would have any interest in this fund I don't know." One of Fairfield Greenwich's most sought-after funds is Fairfield Sentry Limited. Managed by Bernie Madoff, Fairfield Sentry has assets of $3.3 billion.

A Madoff hedge-fund offering memorandums describes his strategy this way: "Typically, a position will consist of the ownership of 30-35 S&P 100 stocks, most correlated to that index, the sale of out-of-the-money calls on the index and the purchase of out-of-the-money puts on the index. The sale of the calls is designed to increase the rate of return, while allowing upward movement of the stock portfolio to the strike price of the calls. The puts, funded in large part by the sale of the calls, limit the portfolio's downside."

Among options traders, that's known as the "split-strike conversion" strategy. In layman's terms, it means Madoff invests primarily in the largest stocks in the S&P 100 index -- names like General Electric , Intel and Coca-Cola . At the same time, he buys and sells options against those stocks. For example, Madoff might purchase shares of GE and sell a call option on a comparable number of shares -- that is, an option to buy the shares at a fixed price at a future date. At the same time, he would buy a put option on the stock, which gives him the right to sell shares at a fixed price at a future date.

The strategy, in effect, creates a boundary on a stock, limiting its upside while at the same time protecting against a sharp decline in the share price. When done correctly, this so-called market-neutral strategy produces positive returns no matter which way the market goes.

Using this split-strike conversion strategy, Fairfield Sentry Limited has had only four down months since inception in 1989. In 1990, Fairfield Sentry was up 27%. In the ensuing decade, it returned no less than 11% in any year, and sometimes as high as 18%. Last year, Fairfield Sentry returned 11.55% and so far in 2001, the fund is up 3.52%.

Those returns have been so consistent that some on the Street have begun speculating that Madoff's market-making operation subsidizes and smooths his hedge-fund returns.

How might Madoff Securities do this? Access to such a huge capital base could allow Madoff to make much larger bets -- with very little risk -- than it could otherwise. It would work like this: Madoff Securities stands in the middle of a tremendous river of orders, which means that its traders have advance knowledge, if only by a few seconds, of what big customers are buying and selling. By hopping on the bandwagon, the market maker could effectively lock in profits. In such a case, throwing a little cash back to the hedge funds would be no big deal.

When Barron's ran that scenario by Madoff, he dismissed it as "ridiculous."

Still, some on Wall Street remain skeptical about how Madoff achieves such stunning double-digit returns using options alone. The recent MAR Hedge report, for example, cited more than a dozen hedge fund professionals, including current and former Madoff traders, who questioned why no one had been able to duplicate Madoff's returns using this strategy. Likewise, three option strategists at major investment banks told Barron's they couldn't understand how Madoff churns out such numbers. Adds a former Madoff investor: "Anybody who's a seasoned hedge- fund investor knows the split-strike conversion is not the whole story. To take it at face value is a bit naïve."

Madoff dismisses such skepticism. "Whoever tried to reverse-engineer, he didn't do a good job. If he did, these numbers would not be unusual." Curiously, he charges no fees for his money-management services. Nor does he take a cut of the 1.5% fees marketers like Fairfield Greenwich charge investors each year. Why not? "We're perfectly happy to just earn commissions on the trades," he says.

Perhaps so. But consider the sheer scope of the money Madoff would appear to be leaving on the table. A typical hedge fund charges 1% of assets annually, plus 20% of profits. On a $6 billion fund generating 15% annual returns, that adds up to $240 million a year.

The lessons of Long-Term Capital Management's collapse are that investors need, or should want, transparency in their money manager's investment strategy. But Madoff's investors rave about his performance -- even though they don't understand how he does it. "Even knowledgeable people can't really tell you what he's doing," one very satisfied investor told Barron's. "People who have all the trade confirmations and statements still can't define it very well. The only thing I know is that he's often in cash" when volatility levels get extreme. This investor declined to be quoted by name. Why? Because Madoff politely requests that his investors not reveal that he runs their money.

"What Madoff told us was, 'If you invest with me, you must never tell anyone that you're invested with me. It's no one's business what goes on here,'" says an investment manager who took over a pool of assets that included an investment in a Madoff fund. "When he couldn't explain how they were up or down in a particular month," he added, "I pulled the money out."

For investors who aren't put off by such secrecy, it should be noted that Fairfield and Kingate Management both market funds managed by Madoff, as does Tremont Advisers , a publicly traded hedge-fund advisory firm.

http://online.barrons.com/article/SB989019667829349012.html

 

[MThanded]

50 billion dollars??? WTF are you serious. What an amazing scheme... you got caught though son.

 

[speculawyer]

Replace "rich people" with, say, "investment banks."

I don't think investment banks are one of the few clients of this coot.

 

[LJ11]

50 billion dollars??? WTF are you serious. What an amazing scheme... you got caught though son.

He only had $17 billion under management, where's the other $33B? Someone's going to take a bath. FGG is fucked. :lol

 

[speculawyer]

I've got some admiration for this guy in weird ways:
1) The guy has brass balls the size of bowling balls to pull this off. Holy fuck . . . we are talking massive amounts of money. Amazing. And he kept it going for YEARS!

2) He actually turned himself in and confessed (at least to some).

And what are we gonna do? Lock up a 70 year old guy? Sure . . . so what. Does that accomplish anything? He's a 70 year old guy . . . how much out in the free world is he gonna miss? Sex? No. Videogames? No. Drugs? No. The taxpayers are now going to pay for his housing, healthcare, and meals.

It is like the perfect crime.

 

[speculawyer]

He only had $17 billion under management, where's the other $33B? Someone's going to take a bath. FGG is fucked. :lol

 

[KR3W]

AMERICA FUCK YEAH, etc...

 

[MThanded]

He only had $17 billion under management, where's the other $33B? Someone's going to take a bath. FGG is fucked. :lol

 

[LJ11]

In an era of faceless organizations owned by other equally faceless organizations, Bernard L. Madoff Investment Securities LLC harks back to an earlier era in the financial world: The owner''s name is on the door. Clients know that Bernard Madoff has a personal interest in maintaining the unblemished record of value, fair-dealing, and high ethical standards that has always been the firm''s hallmark

:lol

I woke up laughing my ass off. Looked at my messages, "Looks like the lifeguard took everyone for a swim." Couldn't stop laughing. One fund is out $7B, they manage about $18B...lol

By the way, an anonymous poster on a popular Traders Forum posted a tip back in '06 that the SEC and/or Spitzer was on to Madoff. Thread was bumped this morning.

Madoff, who believes that he deserves “some credibility as a trader for 40 years,” says: “The strategy is the strategy and the returns are the returns.” He suggests that those who believe there is something more to it and are seeking an answer beyond that are wasting their time.

:lol

You can read the rest here. FYI, it's a PDF

 

[speculawyer]

Greed is not always good.

I Knew Bernie Madoff Was Cheating; That's Why I Invested with Him


Interesting tidbits coming in about Bernie Madoff (read indictment here).

Specifically, we're hearing that the smart money KNEW Bernie had to be cheating, because the returns he was generating were impossibly good. Many Wall Streeters suspected the wrong rigged game, though: They thought it was insider trading, not a Ponzi scheme. And here's the best part: That's why they invested with him.

For years and years I've heard people say that [Bernie's] investment performance was too good to be true. The returns were too steady -- like GE earnings under Welch -- and too high given the supposed strategy.

One Madoff investor, himself a legend, told me that Madoff's performance "just doesn't make sense. The numbers can't be straight." Another sophisticated Madoff investor actually went through trade confirms in order to reverse-engineer the strategy and said, "it doesn't add up."

So why did these smart and skeptical investors keep investing? They, like many Madoff investors, assumed Madoff was somehow illegally trading on information from his market-making business for their benefit. They didn't consider the possibility that he was clean on that score but running a good old-fashioned Ponzi scheme.

And another from Whitney Tilson:

One friend who saw this coming said Madoff had his own broker-dealer and a relative as his finance guy; another friend said he was suspicious because of the 1-2%/month returns with never a down month (much less quarter or year), combined with never showing a a down month (much less quarter or year), combined with never showing anyone his portfolio. 99% of the time, if it sounds too good to be true, IT IS!

People were so greedy that they didn't care if they were investing in a person that was 'cheating'. Well . . . sorry, guess who he was cheating? :lol

People really need to take this lesson to heart when it comes to politics. If the candidate you like is lying a lot about his opponent, but you don't mind that because he is only lying about the other guy . . . you are only setting up for disaster when you realize that he's been lying to YOU too.

(Such as how the economy is going, whether WMDs exist, how the war is going, how much the war will cost, etc.)

 

[CharlieDigital]

Greed is not always good.

People were so greedy that they didn't care if they were investing in a person that was 'cheating'. Well . . . sorry, guess who he was cheating? :lol

The way I understand it, in a Ponzi scheme, the only people who get "cheated" are the last ones in. It's kind of like musical chairs...you're all good if you get in while the music is playing and you're fucked once the music stops.

 

[speculawyer]

The way I understand it, in a Ponzi scheme, the only people who get "cheated" are the last ones in. It's kind of like musical chairs...you're all good if you get in while the music is playing and you're fucked once the music stops.

It really depends on when it blows up and whether you pulled out of it. If you are one of the early ones and left your principal in the 'fund', you are fucked too.

 

[norinrad21]

Alright where's the money? at his age he won't live long enough to finish it

 

[pollo]

Wow.

They said he faces up to 5 years in prison and a fine of up to $5 million.



:lol :lol :lol :lol :lol :lol :lol :lol :lol :lol :lol :lol

This country's law system is a fucking joke.

 

[Skittleguy]

Mon-EH!

 

[speculawyer]

They said he faces up to 5 years in prison and a fine of up to $5 million.



:lol :lol :lol :lol :lol :lol :lol :lol :lol :lol :lol :lol

This country's law system is a fucking joke.

(neutral) pollo
I am a cop
(Today, 12:18 PM)
Reply | Quote

 

[reaver18]

why does 50 billion not seem like that much money to me anymore?

 

[xero273]

I am kind of confused about this Ponzi scheme. So did Madoff actually make any money off this?

I read about the ponzi scheme on wiki but all it says is that when one investor invests, that investment goes out as payment to another investor. So how would Madoff make money?

 

[CharlieDigital]

I am kind of confused about this Ponzi scheme. So did Madoff actually make any money off this?

I read about the ponzi scheme on wiki but all it says is that when one investor invests, that investment goes out as payment to another investor. So how would Madoff make money?

It's not like he hands over all of the money to the investors. Obviously, he only gives them some really good gains and keeps a big chunk for himself.

 

[Tarazet]

I am kind of confused about this Ponzi scheme. So did Madoff actually make any money off this?

I read about the ponzi scheme on wiki but all it says is that when one investor invests, that investment goes out as payment to another investor. So how would Madoff make money?

It sounds like he paid regular (very high) dividends, and just stole the principal for himself. He did have to keep enough on hand so that he could redeem shares when he had to, but then there was a run and he didn't have enough money to pay it all back.

 

[RiZ III]

Why steal a million .. when you could steal.. 50 billion??

 

[DeadTrees]

Madoff, who believes that he deserves “some credibility as a trader for 40 years,” says: “The strategy is the strategy and the returns are the returns.”

You know, even now, you can't logically refute that statement.

Also: Bernie Comes Out of the Closet :

Not a year has gone by during the past fifteen that I have not contemplated what Bernie Madoff did (or didn't do) to make his money. Seventy to one-hundred basis-points-a-month. Net. Net. Net. During tempests, earthquakes, panics and crashes - even during the closure of the exchange itself, Bernie apparently minted coin like few others. Even Renaissance and Shaw tripped occasionally. Not Bernie. Yet no one new what he did. It was one of the best kept secrets in the world. Oh yeah, sure, split-strike conversions were the official line. But every skeptical arb trader knew this couldn't be true.

I also never came across an ex-Madoff trader the way one meets ex-Shaw, ex-Moore Cap, or ex-Citadel employees. Resumes are sent in reply to postings and guys have done the rounds, even if they weren't unhappy and making a moral statement. A spouse moves...whatever. Surely there must be disgruntled Madoffians somehwere, right?. Were they ummm underground? I mean, iterally? My friends at a large IB (who were soliciting business from them years ago) who'd been to their offices said it looked the bridge from the USS Enterprise (the Starship - The Next Generation version). Entry to the IM sub was strictly verboten. Uh huh. He said it was a paperless office. No paper trails. Hmmmm. Violators were fired. Weird. No one transgressed.

In 2000, I advised a family-office on their alternative investments, and constructed a portfolio on their behalf. I had free rein (thanks! anon). Included in their legacy portfolio was a sizable Madoff position. As a fiduciary - and a conservative one - coming on the heels of LTCM which also lacked transparency and which made it hard for me to raiise capital - I dug, asked every welll-connected equity-finance, prime-broker, electronic trader and HF allocator type I knew and it still didn't add up. The best and brightest still had no more insight than I, though the skeptical shared my suspicions. So, I strongly suggested they "dump it". "One isn't being compensated sufficiently for not knowing, and something just isn't right here. Yeah maybe its OK, but I think it's not". But they liked "it" and they liked "him". "He's always paid", they said. "We've been with him a long time". Old school they were. Trusting. What the fuck did I know anyway?

Some crimes are too perfect. Some facades too well-painted to be original or convincing. A good hustler knows he must lose sometimes in order to win. THAT is the reflection of reality that makes it believable, and gives confidence to the punter who will shortly be taken out. THAT was what was wrong with Bernie Madoff's ponzi. The people who were taken - like the Family Office and many others investors who in time will go public on their fleecing - wanted badly to believe they were onto to something that was so good that they ignored the most obvious signs of bogusness. It just didn't make sense. It just didn't add up. Even Jim Simons earns it. There is no free lunch.

There is something fitting and just in the timing of this. It is emblematic of America since Reagan and the Great Leveraging. Something for nothing. Thank you Mr Laffer. But as a philosophy and modus operandi it is quite literally, bankrupt and without merit. And Laffer has since been proven to be full of shit. Now, Americans will have to confront this, the premise that greed is good and self-guiding and somehow omnisciently beneficial for it has had repurcussions down to the core of our society and values. "Sorry everyone....what you've been pursuing has all been a lie, a big ponzi, a rat-hole to nowhere....". Re-boot.

 

[speculawyer]

This story keeps providing the LULZ.

NEW YORK (Reuters) - Investors scrambled to assess potential losses from an alleged $50 billion fraud by Bernard Madoff, a day after the arrest of the prominent Wall Street trader.

Prosecutors and regulators accused the 70-year-old former chairman of the Nasdaq Stock Market of masterminding a Ponzi scheme of epic proportions through his investment advisory business, which managed at least one hedge fund. Hundreds of people, investing with him through the firm's clients, entrusted Madoff with billions of dollars, industry experts said.

"Madoff's investors included captains of industry, corporations -- some of which are publicly traded -- that used Madoff almost as a high-yielding cash management account, endowments, universities, foundations and, importantly, many high-profile funds of funds," said Douglas Kass, who heads hedge fund Seabreeze Partners Management.

"It appears that at least $15 billion of wealth, much of which was concentrated in Southern Florida and New York City, has gone to 'money heaven,'" he said.

A Ponzi scheme is an illegal investment vehicle that pays off old investors with money from new ones, and is dependent on a constant stream of new investment. Because the invested capital is not earning a sufficient return on its own, such schemes eventually collapse under their own weight.

Federal agents arrested Madoff at his apartment on Thursday after prosecutors said he told senior employees that his money management operations were "all just one big lie" and "basically, a giant Ponzi scheme."

Madoff is the founder of Bernard L. Madoff Investment Securities LLC, a market-making firm he launched in 1960. His separate investment advisory business had $17.1 billion of assets under management.

'BUSINESS AS USUAL?'

About a dozen angry investors gathered on Friday in the lobby of the Lipstick Building in midtown Manhattan, where the market-making firm and advisory business are headquartered, demanding to know the fate of their money.

One woman said that when she called the firm's offices on Thursday she was told it was "business as usual."

Another investor groused, "Business as usual? Of course it's business as usual. We're getting screwed left and right."

Police later evicted the small group from the building.

Individual investors were feeling the squeeze elsewhere.

"I expect to get back zero," said Susan Leavitt in Tampa Bay, Florida, who invested through Madoff. "When he tells the Feds, he has $200 million to $300 million left out of billions, what can you expect.

The two most prominent hedge funds that invested with Madoff were the $7.3 billion Fairfield Sentry Ltd, run by Walter Noel's Fairfield Greenwich Group, and the $2.8 billion Kingate Global Fund Ltd, run by Kingate Management Ltd.

Fairfield Sentry and Kingate Global were among a small group of hedge funds to report positive returns for 2008; the average hedge fund was down 18 percent, according to data from Hedge Fund Research.

"People who came to us for portfolio construction were often already invested with Bernie Madoff, he had hundreds of clients," said Charles Gradante, who invests in hedge funds as a principal at Hennessee Group LLC. "Now his whole legacy is destroyed. He was God to people."

Prior to Madoff's arrest, investors had wondered how he was able to generate annual returns in the low double digits in a variety of market environments. Many questioned how U.S. regulators were able to ignore numerous red flags with regards to Madoff's operations.

"Many of us questioned how that strategy could generate those kinds of returns so consistently," said Jon Najarian, an options trader who knows Madoff and is a co-founder of optionmonster.com.

In May 2001, Barron's reported that option strategists for major investment banks said they could not understand how Madoff managed to generate the returns that he did.

"We weren't comfortable with Madoff," said Brad Alford, president at investment adviser Alpha Capital in Atlanta. "We didn't understand how his strategy could generate the kind of returns it did. We will walk away from things like that."

He was God to people? "Money Heaven"?

It is clear what this country really worships.

 

[xnipx]

so the way i'm reading this is, he took all these investments and used each subsquent one to pay out huge gains in which people knew it was too good to be true and now they are finding out that the principal they invested is gone? sounds like a brilliant plan to me....until you get caught.....for reference from a project i just did: 5 grams of crack cocaine will get you a mandatory minimum of 5 years federal pound you in the ass prison, distributing or consuming it doesn't matter...street value ~$750....white collar crime sounds so awsome to me

 

[speculawyer]

The 70-year-old Madoff (MAY-doff), well respected in the investment community after serving as chairman of the Nasdaq Stock Market, was arrested Thursday in what prosecutors say was a $50 billion scheme to defraud investors.

They should have known better . . . the scheme was right in the guy's name . . as in "That guy sure made off with your money!"

 

[CharlieDigital]

...for reference from a project i just did: 5 grams of crack cocaine will get you a mandatory minimum of 5 years federal pound you in the ass prison, distributing or consuming it doesn't matter...street value ~$750....white collar crime sounds so awsome to me

What's even more fucked up about all of this? Thousands (who knows how many with some large funds who were exposed to this) lost a good chunk (if not all) of their retirement savings. And we find out that:

Madoff said the business had lost about $50 billion and that he planned to turn himself in to authorities in a week. But, the complaint said, he told the employees he wanted to distribute the $200 million to $300 million he had left to certain selected employees, family and friends.​

So yeah, guy deserves life in prison for fucking up the lives of thousands of people directly/indirectly and each of them should get to punch him in the balls.

 

[lastendconductor]

You can truly asses that this society is rotten to core. And not because things like what this guy did, but because people admire this shit, like you guys are doing in this thread. This guy needs his entire fortune ripped off, amongst other things... like his fucking head.

 

[HamPster PamPster]

I don't get it

Why not run away back in 1980 or whenever he stole his first 100 million or so and just live out the rest of your days on a beach somewhere without a care in the world

why does 50 billion not seem like that much money to me anymore?

So true

 

[Stinkles]

Prosecutors charged Madoff, 70, with a single count of securities fraud. They said he faces up to 5 years in prison and a fine of up to $5 million.

Ah, white collar crime...

What would I get for dealing weed if I was a black teenager? This is so disgusting I don't even know where to begin.


Edit: Mevermind, just read the 5grams of crack example. RAGE!

 

[xnipx]

Several charities were shut down over the weekend due to their entire portfolio being trusted with Madoff. I hope an entire list is compiled soon to truly show how much damage he has done and I HOPE appropriate punishment is given....

however I doubt it given he is already out on bail and his potential fine is ONLY $5 million when he is a billionaire. I think his entire net worth should be wiped out in order to attempt and pay back the people he swindled. the fact that they are going to let him keep any money at all to his name is ludicrous

 

[Loki]

I don't get it

Why not run away back in 1980 or whenever he stole his first 100 million or so and just live out the rest of your days on a beach somewhere without a care in the world

Because nothing is ever enough for these greedy bastards. Why be content with $100M when you can have $50 BILLION ZOMG! This is one of the main probems with the entire economy imo, but few people seem willing to face it.

EDIT: I am aware he didn't pocket $50B personally, just making a point.

 

[Loki]

I think his entire net worth should be wiped out in order to attempt and pay back the people he swindled. the fact that they are going to let him keep any money at all to his name is ludicrous

I agree. I say leave $5-10M to his kids/wife (it's not their fault) and distribute the rest. Liquidate all his assets except the primary residence, sell all his stocks, seize all his accounts. Distribute it all or put it in public trust. Make an example of him.

 

[LCGeek]

Nothing you do will makeup for the damage shit like this can do to a society. Very rarely do I advocate death penalty but for white collar stuff even a fraction of this level government needs to let the cons know it's on the table.