The Ponzi Scheming

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

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.

December 11th, 2008 started out like an average work day for Eleanor Squillari, secretary for Mr. Bernie Madoff, at Bernard L. Madoff Investment Securities. After reaching her desk she received a call from Ruth Madoff, who sounded rather lifeless instead of her usually upbeat self. Ruth was inquiring whether her sons had made it into the office; Eleanor informed her that they hadn’t, while in the back of her mind she kept thinking about Ruth’s strange voice. However, she didn’t question it but continued her day, going on her regular rounds. As she descended to floor 18 she observed that the conference room was full of serious men is suits, all surrounding Peter Madoff, Bernie’s bother. “Strange,” she noted, along with why Bernie still hadn’t shown up. She was interrupted by a big man in a trench coat walking in her direction, but she questioned him first. He responded by flashing his badge and yelling “F.B.I!” “What’s happening? Was someone kidnapped? ” she didn’t know where to start, but her confusion was resolved when Peter 's secretary walked over. Looking stunned, she said "They 're saying that Bernie was arrested for fraud." “No, that’s not true!” Eleanor replied, but Peter walked by and reaffirmed it. She was shocked; for twenty years she never noticed anything about the international White Collar crime that was run right under her nose (Seal, Squillari).

Trust is extremely important in business transactions. Greed also plays a role in some business transactions. Discuss how these two concepts were intertwined in this case.

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.

Bernie Madoff‘s compliance department should provide a variety of channels for employees to submit questions and to report suspected violations. These system should be easy to access, simple to use, maintaining confidentiality, publicize throughout the organization, and accommodating of employees’ needs. Examples of the reporting system are a telephone helpline, a fax number, a postal address, a Web-portal or e-mail inbox, direct supervisor and managers, external auditors, etc. The compliance office should act as a central clearinghouse for inquiries, so oversight of the advising and reporting

“How could they know that their fortunes didn't exist, and never had? How could they know that, instead of Bernie fueling their extravagant lifestyle, they had been fueling his?” (Kirtzman, 5). “No one was asking how Madoff or his minions would bankroll the returns they were guaranteeing. No one seemed to mind that there was scant paperwork to go with his orders, or question why receipts were being written on scraps of paper.

If you're vigilant and check your statements regularly, then you are probably safe. But, there are times where people may lose their entire life savings in an instant. Some people who are not educated on retirement plans or people who are getting older and they aren't up with the times may be subject to a Ponzi scheme or some other type of fraud.

Bernie intently accepted large sums of funds from investors with the knowledge that he was not going to make legitimate investments with his the stackholders money. Bernie Madoff’s was conducting his business practices off of maximizing profits for himself over twenty years, which he intentialy defrauded his clients of almost sixty-five billion dollars. It is in my opinion that Bernie Madoff’s apparently knew what he was doing when he was engaging in un-ethical practices. When Madoff pled guilty to all charges in March 2009, which includes securities fraud, mail fraud, false statements, false filings with the SEC, investment advisor fraud, wire fraud, money laundering, and theft from an employee benefit plan, I believe that he completely understood that his scam would be exposed at some time.

To combat this assumption it turns out large amounts of money of the value of $300million was invested in Bernard Madoff accounts in the form of pension funds. Some officials knew that the unscathed performance of Madoff securities were too good to be true as their prices consistently climbed up in spite the financial crisis. However, still they pawned its own shareholders’ funds with the hopes of jumping on the same band wagon as Madoff and reaping further profits. Another angle at probing the case was that the CEO, directors as well as executives were only looking out for themselves. Evidently they had direct benefits in the form of handsome compensation packages for retaining high profile clients such as Madoff and Wise which

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

Introducing Bernard L. Madoff born April 29, 1938 in Queens, NY and is presently serving a one hundred fifty-year prison sentence. Who is this fraudster Bernard L Madoff also known as “Bernie” and what fraud did he commit? Bernie’s parents Ralph and Sylvia Madoff were Polish immigrants struggling and working during the Great Depression Era. In later years, his mother worked in finance as a broker-dealer for their company Gibraltar Securities. The SEC eventually forced the business to close due to non-reporting issues regarding the businesses financial condition. Around age twenty-two, Bernie Madoff started his own investment firm Bernard L. Madoff Investment Securities LLC and was

The first notorious Ponzi scheme was orchestrated by a man named Charles Ponzi in 1919. In the 1920s Charles Ponzi took advantage of the varying prices of international reply coupons. He bought reply coupons in a different country, where they were cheaper, and then sold them in the US where they were worth more. He attracted his investors by promising 50% returns in 45-90 days.

A Ponzi scheme is an illegal business practice in which new investor’s money is used to make payments to earlier investors. In many Ponzi schemes, the fraudsters focus on attracting new money to make promised payments to earlier-stage investors and to use for personal expenses, instead of engaging in any legitimate investment activity. The returns are repaid out of new investors’ principal, but not from profits. This can continue as long as new investors line up with cash, and old investors don’t try to withdraw too much of their money at once.

A content smile spread over Bernie 's plump cheeks. What on earth would he do without Marty? Well, probably the same thing he 'd been doing for centuries now, but that was beside the point.