Bernie Madoff
In December 2008 Bernie Madoff was arrested under the suspicion of fraud. His Wall Street firm, Bernard L. Madoff Investment Securities LLC, was founded in 1960. Madoff was the chairman of this company through its entire existence until his arrest. Ponzi Schemes such as the one Bernie Madoff started at his company have been around for years; the first being Charles Ponzi’s scheme in the 1900’s. Madoff made history through his scheme as it is considered one of the largest financial frauds ever. Madoff pulled the fraud off by taking money from investors and charities, and promising huge returns. Huge returns are exactly what his investors received also. Madoff was able to miraculously make his investors’ money with continually high percentages. Investors flocked to Madoff after seeing such great profits being made by others. Madoff ran his fraud operation anywhere from 18- 48 years. According to him the first fraud performed started in 1990 whereas, others believe the company could’ve possibly been illegitimate throughout its existence. How does a person trick thousands of people into investing in a fraud? An answer for that could be good leadership. Madoff’s clients were often times people he knew on a personal basis. Portraying a self-image that showed honesty, intelligence, and confidence, Bernie had his investors trusting him not only financially, but also on a personal level. Although his intentions were selfish, wrong, and ignorant, his followers trusted him fully. This allowed Madoff to continue his process of simply taking money from one investment and giving it as a payoff to another. A process so simple ended up causing thousands of people to be in debt. The totals of his fraud reach numbers upwards of $50 billion. The next question that comes to mind is: how do you take money from all these people and they never realize what is actually happening? Madoff’s general employees didn’t know that the company was a scam but his “specialized” group of
Cited: "Scam of the Century: Bernie Madoff & The $50 Billion Heist." CNBC.com. Cnbc, n.d. Web. 27 Jan. 2013.