Lying: Bernie Madoff's Ponzi Scheme

Bernie Madoff, the founder of Bernard L. Madoff Investment Securities, ran one of the biggest schemes in history. Bernie Madoff stole $65 billion dollars from his investors over the course of two decades. He stole money from victims such as Steven Spielberg, Kevin Bacon, Carl Shapiro, thousands of wealthy retirees, charities, and supposedly sophisticated financial firms. He convinced them to give him their money by falsely promising profits in return. He was caught in December 2008 and pleaded guilty in March 2009. He was charged with 11 counts of fraud, money laundering, perjury, and theft. He was arrested and is now facing 150 years in prison. The people caught working with him on this scheme were five of his employees , his accountant and

Bernie Madoff was one of the most prolific Ponzi-scheme artists in history. Madoff schemes netted him millions of dollars. Mr. Madoff used his BMIS Bernard L. Madoff Investment Securities a New York Limited Liability company, to commit fraud, money laundering, and perjury. This is just a few things that Mr. Bernard Madoff has done to many innocent investors, who believed in Mr. Madoff, and everything he stated. Due to Mr. Madoff’s action he has changed so many people’s lives. Some have lost everything, some committed suicide, and others just humiliated by Mr. Madoff. This paper is to tell you about Mr.

Judge Denny Chin presided over the Bernie Madoff Ponzi scheme case where Madoff was sentenced to 150 years in prison. “The penalty sparked a burst of applause in a courtroom packed with victims of the fraud.” (Frank). Mr. Madoff ruined hundreds of lives that put their life savings and trust in his hands. Bernie expressed remorse after fraud victims address their concerns in the courtroom in regards to massive Ponzi scheme. Friends and family were not there to support Madoff in his day of sentencing and remain inadequate of further information of details about the fraud. Bernie Madoff is believed to have betrayed everyone including his two sons who work for the investment firm. Rich and poor people alike shared in this despair after all of their

Madoff was able to align himself with wealthy individuals, leaders involved in foundations, business entities, and government. This gave him unlimited access to different groups of investors. Among Madoff’s Ponzi scheme victims, it is easy to find wealthy individuals, charitable organizations, and its stakeholders, such as employees, communities, vendors, and even the government.

From about 1960 to the 1990’s, Madoff’s business grew like crazy, mainly from some well-known investors and friends. Because of all this Bernie became very successful very fast. This caused him to start getting greedy. In the 1990’s Bernard L. Madoff Investment Securities began conducting illegal acts of fraud, Madoff started an illegal money-management business, promising his investors consistent returns. Investors were so interested in the high returns, that no one questioned Madoff or his strategy. In 2008, investors began requesting payouts for their investments and Madoff started to become very desperate for new funds. His strategy began to unravel and the truth of his actions started to come out, shocking many people. This case blew up like crazy and once investigators started looking into Madoff’s business they discovered all Madoff was doing was running a Ponzi scheme. He would take funds from new investors, and use that to pay off the older investors. While doing this Bernie was also pocketing a large portion of the money, causing this to be one of the biggest Ponzi schemes in

The method he chose to utilize was a Ponzi scheme. The Ponzi scheme was invented by Charles Ponzi who used the technique to swindle people out of their life savings. A Ponzi scheme is comprised of a central operator who offers high returns on investments. Once a number of investments are secured and new ones come in, they are used to pay off older investments.

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.

Before the exposure of his scheme, Bernard L. Madoff Investment Securities seemed to be a normal investment firm (Bandler & Varchaver, 2009). Bernie was a well-respected in the financial industry, evidenced by being named chairman of the NASDAQ and by being asked to testify before congress (Bandler & Varchaver, 2009). Bernie’s brother, Peter served as the head of compliance in the legitimate trading side of the firm. While Peter was technically savvy, Bernie was anything but (Bandler & Varchaver, 2009). His computer was set up to report financial news and nothing else (Bandler & Varchaver, 2009). He didn’t have an email account, and it was said that “he could barely turn his computer on” (Bandler & Varchaver, 2009).

Introduction Bernard Lawrence "Bernie" Madoff ran one of the largest Ponzi Schemes. A Ponzi scheme is a scam investment designed to separate investors from their money. It is named after Charles Ponzi, who constructed one such scheme at the beginning of the 20th century. The scheme is designed to convince the public to place their money into a fraudulent investment. Once the scam artist feels that enough money has been collected he disappears taking all the money with him.

Ponzi schemes are fraudulent investments in which false returns from a new investor are given to existing investors. The facilitator of a Ponzi scheme lures new victims in by promising high return and little to no risk investments. Most schemes are driven by the con artist creating a façade. Con artists create these facades by bringing in new investors and promising payments, to build up the same facade so they can continue to create the appearance of a lucrative, genuine business to invest in (Ponzi Schemes, 2013). Ponzi scheme is derived from a man named Charles Ponzi.

Mr. Madoff’s Ponzi scheme took careful coordinating and preparation to last as long as it did and to become the largest Ponzi scheme in history. He used his greed to entice the greed of his investors by offering them unrealistic

Madoff’s Ponzi scheme was very complex and operated on major scale. Typically scam artist would take money from new “investors” and use it to pay off existing investors. Eventually the scheme ends when there are no new

When the financial crisis of 2008 struck the world, there were multiple business scams and schemes that became exposed, creating a colossal uproar and unrest around the world. When the stock market collapsed, people all across America took a hit, with 2.4 trillion dollars of the Americans people’s savings vanishing in just a few weeks. This financial crisis also brought to light an unprecedented amount of fraud, over exposing people who were cutting corners. One of the most famous scams that surfaced in late 2008 was operated and executed by Bernard Madoff, in which he perpetrated the largest Ponzi scam in American history. A Ponzi scheme is a simple swindle where by one set of investors are paid unreal returns out of money received from another investor. A Ponzi scheme is however always disaster prone from the beginning as there is never a strategy to wholly recoup investors money.

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.

On Dec. 11, 2008, Bernard Lawrence Madoff confessed that his vaunted investment business was all "one big lie," a Ponzi scheme colossal in volume and scope that cost investors $65 billion. Overnight, Madoff became the new poster child for Wall Street gall, greed and