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Madoff took money in. He also paid some money out. He simply never invested any of it anywhere ~ although folks assume he has a stash somewhere (which might not be the case). He gave his "customers" simple reports that just made up stuff. You could do this with nothing more elaborate than a pre-printed formal letterhead, Quicken and an inkjet printer. One guy.

So did any of the investors deal directly with Madoff? And how did the investors invest... cash or check ? And wasn't there some guy that was his front man that went around enticing investors to invest? Sounds like there may be no literal money trail directly to Madoff, and the so called investors may have to provide the evidence they invested in the first place.

Madoff took money in......he paid some money out. He gave his "customers" simple reports that just made up stuff. You could do this with nothing more elaborate than a pre-printed formal letterhead, Quicken and an inkjet printer.

ANALYSTS: FIRM SENT CLIENTS 'DATED' INFO
NY POST, By MARK DeCAMBRE and KAJA WHITEHOUSE, 12/17/08

EXCERPT The performance statements that fallen Wall Street big Bernard Madoff's firm sent to clients appear riddled with inaccuracies and other suspicious signs that should have raised red flags, according to experts who've reviewed the documents obtained by The Post.

For example, one statement that's part of a Nov. 30 performance report suggests that Madoff's outfit purchased shares of Apple at $100.78 on Nov. 12. However, even when accounting for a usual three-day settlement period, the stock never traded at $100 a share. Its trading range on the day that the shares were supposedly bought was between $90.01 and $92.43, sources noted. Such inaccuracies appear throughout the performance statement.

In another case, the Madoff statement reflects the purchase of Citigroup shares at $12.51 on Nov. 12, even though the stock that day traded in a range between $9.52 and $10.63. "Everything's a couple bucks off," said Jonathon Trugman, founding partner of New York hedge fund Pendulum Capital Management, who reviewed the documents but did not invest with Madoff. "To find something as glaring as the price of Apple stock, what more do you need?" said Trugman.

Others note that Madoff used an outmoded bookkeeping method to record his performance data, and added that his presentation, which lacks details, harkens back to an earlier period before investors demanded more disclosure.

"These look like statements from the mid '90s at the earliest," said New York attorney Ross Intelisano, who's been retained by Madoff clients who've lost money. "If I was [Madoff's] client, I would be very dissatisfied with the quality of the reporting." Added Bob Ellis, a brokerage analyst with research firm Celent, "This is a very bad retail account that doesn't give you very much information. There's hardly any information here about realized or unrealized gains. "None of the other wire-houses or independent firms would have used this old accounting style," he added.

The lack of transparency is surprising since Madoff was considered a friend to regulators and a huge supporter of full disclosure.

One forensic accountant who spoke with The Post said he also noted that Madoff's client statements appear to have been printed using an outdated "impact printer," which haven't been in widespread use since the advent of laser printers. They even pre-date the dot-matrix printers used in the 1990s. "It's just odd for a guy managing $17 billion to being using this sort of technology," the accountant noted.

Others added that one of the more striking red flags to jump out were the deficiencies in Madoff's overall strategy. "You're trying to get above-market returns by buying the bluest of the blue chips, and the truth is the largest of the large-cap stocks move proportionately the least because they have all their information factored into them," Ellis said. "It's just not a strategy that generates above-market returns."

SOURCE http://www.nypost.com/seven/12172008/business/analysts__firm_sent_clients_dated_info_144523.htm

Muawiyah, we are probably on the same page on many things regarding this pathetic character, but the one thing I simply cannot concur is that he did it on his own. The 'one guy' part that you assert.

Sure, with Quicken, half an hour, and a bottle of cold soda, I could come up with an investment statement that would win me a free ride at art school, and a set of numbers that would make Benjamin Graham smile, and then send it off. Thus, Madoff could easily come up with some statements ...that is not hard.

However, if it was just him doing that, then what were his two sons, and the other people at the 'investment firm,' doing? Warming their seats? Twiddling their thumbs? Sitting by and wondering why they are receiving a salary for checking out FR/DU/porn on their computers instead of working?

There is no way Madoff could have done this alone. A few weeks back I listed what I would need to pull this off (I am a fund manager and one of the principals at a frontier market fund), and even if you really narrow the list, make Madoff a super-manipulator, and give him a casket of leprechaun-strength Pixie dust ....there is still no way he could have done this by himself without anyone in his company knowing there was something fishy going on.