In December 2008, one of the largest Ponzi scheme surfaced when Mark and Andrew Madoff reported the works of their father, Bernard Madoff to the federal authorities. A Ponzi scheme is an investing scam that promises high rates of return with little risk to investors. The operator generates returns for older investors by gaining new investors. Bernard was arrested on December 11, 2008 and charged with securities fraud. He pled guilty to 11 counts and was sentenced to 150 years in federal prison-the maximum possible prison sentence. A reported $17.3 billion was invested into the scam by Bernie’s clients and only about $2.48 billion have been returned to these victims as of September 2012.
My next guest, Bernard Madoff, also known as Bernie Madoff, is a completely different criminal than Al Capone. Although they had the simulates of their parents being immigrants and both being convicted of crimes involving money. Now I’m getting ahead of myself, let me start from the beginning. Bernie Madoff was born on April 29, 1938, in Queens, New York. His parents were Polish immigrants. His dad worked as a plumber and his mom was a house wife before opening a broker-dealer business called, Gibraltar Securities. The business was not successful and was closed by the Securities and Exchange Commission for the incompetence of filing out the require documents. So, Bernie had been exposed to fraudulent activities as a child (Kennedy, Adrienne
Bernard L. Madoff Investment Securities LLC operates as a securities broker/dealer in the United States and internationally. It provides executions for broker-dealers, banks, and financial institutions. The company was founded in 1960 and is headquartered in New York, New York. As of December 15, 2008, Bernard L. Madoff Investment Securities LLC is in liquidation.
Bernie Madoff began his career as an investment broker in 1960, where he legally bought and sold over-the-counter stocks not listed on the New York Stock Exchange (NYSE). From the 1960’s through the 1990’s, Madoff’s success and business grew substantially, mainly from a closed circle of known investors and friends through word of mouth. In the 1990’s Bernard L. Madoff Investment Securities traded up to 10 percent of the NASDAQ on any given day. With the success of the securities business, Madoff started an illegal money-management business, promising his investors consistent returns from 10-12 percent, unheard of returns at the time, which should have tipped off most investors that something was amiss.
Capone was born 1899 in Brooklyn, New York to poor immigrant parents from Italy. When Capone was 14, he dropped out of school. He struggled with bullying throughout his young ages because of his ethnic background. During this time period, many people around the United States looked down at the children of immigrants and this made it laborious for him to succeed in school. At this time he was juggling 3 jobs as well as being in a gang. He later graduated into a more brutal
Bernard Madoff had full control of the organizational leadership of Bernard Madoff Investments Securities LLC. Madoff used charisma to convince his friends, members of elite groups, and his employees to believe in him. He tricked his clients into believing that they were investing in something special. He would often turn potential investors down, which helped Bernard in targeting the investors with more money to invest. Bernard Madoff created a system which promised high returns in the short term and was nothing but the Ponzi scheme. The system’s idea relied on funds from the new investors to pay misrepresented and extremely high returns to existing investors. He was doing this for years; convincing wealthy individuals and charities to
We chose Bernard Madoff’s case because we thought that we could relate his case to many unethical behaviors. The analysis can be made on decision making and lack of ethical training which we think is an important topic to focus on this course.
Most people, when they hear the word “crime,” think about street crime or violent crime such as murder, rape, theft, or drugs. However, there is another type of crime that has cost people their life savings, investors’ billions of dollars, and has had significant impacts of multiple lives; it is called white collar crime. The Federal Bureau of Investigation defines white collar crime as
What is right or wrong? People base their values of right and wrong on what they have learned from their experiences (Ferrell, Fraedrich, & Ferrell, 2018). What one person sees as wrong, may be a normal for another. Most people are taught to work hard, save money, and invest for a future retirement. However, when it comes to money, some people lose all principles and standards of behavior. There were several ethical issues in the Madoff case. They include: stealing, cheating, lying, misrepresentation, and deliberate deception. Madoff used the Ponzi scheme or the money pyramid to make his money. In the Ponzi scheme, money was taken from new investors and given to existing customers as earning without being invested. Was this right or wrong? Throughout this case study ethical concerns can be seen on both sides, the investors and Madoff’s.
Al Capone was born on January 17, 1899 in Brooklyn, New York. He grew up with poor immigrant parents and had 7 brothers and sisters. His Father’s name was Gabriele Capone,and his Mother’s name was Teresina Capone. Al was a good student in school until he reached the sixth grade and got into a altercation with his teacher and punched her. After the incident he never went back to school and instead looked to street gangs. Two gangs he joined were the Brooklyn Rippers, and the Forty Thelves. His family then decided it was best for them to move to a safer area and moved to the outskirts of Brooklyn. Al met his wife at this time and two men named Johnny Torrio and Frankie Yale. Torrio was one of the biggest partners Al had ever worked with and also the godfather of his son Albert Francis and Frankie gave Al a job as a bartender and bouncer at the Howard Inn. Meeting these two men was the Start of something new ("Al Capone").
Introduction: Bernie Madoff was a well-respected financier, his company Bernard L. Madoff Investment Securities, LLC was very well known and even helped launch the Nasdaq stock market. Madoffs company was well trusted and he even had celebrity cliental such a Steven Spielberg, Kevin bacon, and Kyra Sedgwick. Madoff came from a low income family however, he was able to start his company from getting a $50,000 loan from his in-laws and he using money that he had saved from side jobs such as lifeguarding and installing sprinkler systems to found his company. The successfulness of Madoff’s company came from the company’s ability to adapt to change and us modern day computer technology. As his business grew he stated employing family members to help “His younger brother, Peter, joined him in the business in 1970 and became the firm 's chief compliance officer. Later, Madoff 's sons, Andrew and Mark, also worked for the company as traders. Peter 's daughter, Shana, became a rules-compliance lawyer for the trading division of her uncle 's firm, and his son, Roger, joined the firm before his death in 2006”(Bernard Madoff Biography 2016) Unfortunately on December 11th 2008 Bernie Madoff became well known for a whole new reason. He had been accused of performing an elaborate Ponzi scheme and he had been reported to the federal authorities by his own sons. A year later he admitted to the investigators that he had lost $50 billion dollars of his investors’ money and pled guilty to 11
Alphonse Gabriel Capone was born on January 17, 1899 in Brooklyn, New York becoming the fourth child of nine children. He was the son of Gabriel and Teresa Capone whom had emigrated from Italy in 1983. When he was in the sixth grade he was expelled from school for hitting a teacher. A variety of events as a teenager led up to his career as gangster such as joining a gang, arrested for multiple charges, and suspicion of murder. Although he worked as a bartender and bouncer, he received the nickname of “Scarface,” due to a knife wound. He married the daughter of a construction laborer, Mary Coughlin on December 30, 1918. Capone began his career as a gangster’s apprentice, joining his mentor’s gang and then being convicted for income tax evasion.
Convictions of the Bernie Madoff conspirators prove the Ponzi scheme could not have been the work of one person. Furthermore, the conspirators each played a critical role in facilitating the Ponzi scheme and concealing it from regulators, and auditors. For instance, Annette Bongiorno, was employed for Madoff for approximately 40 years as his secretary (Lappin, 2014). Consequently, Bongiorno was charged with manufacturing the false statements sent to clients that indicated they were worth a lot more than they actually were. Moreover, Bongiorno transferred $50 million of client’s funds into her own private account (Lappin, 2014).
At first, Madoff was in a broad sense unusual Ponzi manipulator. The extraordinary model was social, connecting with, and set out to bewilderment others with his cerebrum, his thoughtfulness, his thriving. Madoff sharpened a sort of energized spirit about his character, turning that radiant speculation that people would overlook: He won trust not by endeavoring to influence people that he was gorgeous making to move, yet expected that they were well-known. People who may never have fallen for the excellent Ponzi progressive were totally debilitated by Madoff's hypothesis.