Bernard Madoff: Scam Artist

1492 WordsJul 12, 20186 Pages
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. Bernie Madoff was formerly known as a stockbroker,…show more content…
The family was once again in a struggle, also with a $13,000 tax lien on the house that went unpaid from 1956 to 1965. Everything from setting up the company and taking loans were all thought to be a front for Ralph’s backhanded dealings. At this time, Bernie was more focused on his swim team and girlfriend Ruth Alpern, who he met in junior high and continued to date while they attended Far Rockaway High School. He was hired by his swim coach as a lifeguard and here he began saving for his later investment. Bernie graduated high school in 1956, and attended University of Alabama for one year and then transferred to Hofstra University. He married his high school sweetheart in 1959. Ruth was actually the one focusing on finance at this time while attending Queens College. In 1960, Bernie earned his bachelor’s degree in Political science from Hofstra. Ruth also graduated and immediately got a job on the stock market in Manhattan. Bernie decided to study law at Brooklyn Law School, but only went for a year and dropped out to begin his own investment firm. He used the $5,000 that was earned from his lifeguard job to start up the firm. “Bernard L. Madoff Investments Securities, LLC became known for its reliable returns of 10 percent or more and, by the 1980s, handled up to 5 percent of the trading on the New York Stock Exchange.” There was one individual that knew it was a fraud right from the beginning. In fact, he investigated it and laid a

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