BUMP!
it will be interesting to learn what they find...thanks
How did so many smart people get suckered by Bernard Madoff?
“In the US, all those who have made profits from a fraudulent scheme must pay back their gains to the receiver seeking to compensate the victims who have lost money.”
Can you imagine...
Going back 20 years demanding the money back...
There must be some statute of limitations on these things...
I’m wondering why they are so surprised that it could last so long or that it wasn’t a straight ponzi scheme.
The original and then subsequent investors would have no reason to pull out their original principal if they thought were consistently getting 10-17% returns. Most were most likely only taking out the “fake interest” profits, if even that.
More money was probably going in consistently than was being taken out. That would cover the people who actually wanted to take the FULL principal + “fake interest” out. Only after the credit crisis occurred were people pulling money out in large quantities did it become impossible for him to cover.
He’s going to plea this out and all the gory details will soon be forgotten.
And the millionaires just keep on getting hit. ROTFL!
Bernie “Madoff” with the gold
However, they were stupid. Now they are stupid and poorer.
Saw a program on CNBC tonight about this scam..and one of the reporters made the observation that many people are going to suffer if the govt does not step in and do something...like what a BAILOUT for all these fromerly rich investors?
We got caught in a Ponzi scheme too in the 1980..it was just as the folks in the program said...the guy traded on his friendship with people...conning them in to investing and then it just starts to get way out of hand. In our case the guy was my husband’s XO when he was Sqdn CO. The retired LtCol started a business and in the end, he was found out and ended up well the death cert said “ Pilot vs Building”. No one bailed us out and the govt better not make us taxpayers foot this bill.
Bet George Soros is smiling tonight.
I remember a Jewish lawyer in NYC who warned me about this scam in 1995. If I were to post exactly what he said I’d be banned. I can say he said that, “when it unravels it will be monstrous.”
He said he was warning all his clients. I bet that now all his rich clients are lining up outside his office to suck-up to him.
When you start thinking about the mere mechanical and clerical magnitude of the work involved in dealing with $50B, you come to several conclusions very quickly about Madoff:
1. He didn’t do it alone. He had more than his sons in on the scam with him. There’s a whole contingent of people behind this deal.
2. There is more than just Madoff’s firm and the feeder hedge funds involved here.
3. Uncovering all this dirt is going to kick over other mounds of poop. The SEC, especially the SEC under Chris Cox, has been utterly asleep at the switch (what did we expect by putting a Harvard grad in charge of the SEC?) There is a host of dirty funds and bad actors out there in Wall Street, just waiting to be uncovered.
4. If we see a couple more funds or companies get ferreted out who have scammed billions, it is all over for Wall Street. The public will lose trust in the investment and finance industry for a generation, just as they did after the crash of ‘29.
The only thing that would restore public confidence would be handing down some huge penalties for this level of fraud and grift. And I don’t mean house arrest or six months at Club Fed.
I was reading some detailed analysis of the 2005 SEC complaint against Madoff,
http://online.wsj.com/documents/Madoff_SECdocs_20081217.pdf
It seems Madoff should have been making about 3.5% to 6% on the investments during the bubble from 1999 to summer 2007. He was claiming an average return of 12% a year.
If clients were reinvesting profits with Madoff, and the fund grew at a rate larger than the difference between (real returns - stated profits + reinvested profits - capital redemptions) each time period, than he would have been able to go on forever. Except his calculation had an exponential growth rate.
And as has been mentioned elsewhere, there is no statute of limitations for these crimes, so clients will indeed be liable for gains going back well over a decade by the courts.
As long as the courts and Federal Government doesn’t edict a force de majeur.
YOU ROCK!
Thank you for all of your informative posts!
;o)
Merry Christmas!
The money didn’t go POOF!! It’s SOMEWHERE....and these “investors” got DIVIDENDS and RETURNS for YEARS!! And WHY were most of them FOUNDATIONS and CHARITIES??? I smell TAX EVASION.
My bet is that if he had worked as hard at Wallmart he could be worth millions of dollars