Bernie Madoff Analysis
Analyzing Ethical Behavior
Alia Coleman
Grand Canyon University: BUS 340-T500A
October 27, 2013
Introduction In the business world, there are certain codes, rules, and regulations each business company or organization must abide by. Without these laws, businesses would be faced with more conflicts and complications than they already do. Large organizations have taken up certain codes to help pilot and supervise their employees and executives in attempts to avoid fraudulence. These codes are called ethics codes, or codes of conduct. Ethics codes are created to help maintain a satisfactory level of ethical behavior within a business or organization and to help companies function more successfully (Mallor, Barnes, Bowers, & Langvardt, 2013, p. 101). Codes of ethics are broken numerous amounts of times in the business world. When these codes are broken, it can lead to multiple complications and scandals for corporations. Two examples of scandal and fraud in the business world are Bernard Lawrence Madoff and ENRON.
Bernie Madoff Analysis …show more content…
He was convicted of fraud in 2008 when he admitted that his business was, in fact, the largest Ponzi scheme in history. Approximately $20 billion of, so-called, investments had dissipated (Kramer & Ward, 2009, p. 27). In the case of Bernie Madoff, there were several investigations and red flags that appeared throughout each investigation. For instance, the fact that Madoff hardly ever encountered a “down” or “slow” month even in inconsistent markets raised quite a few suspicions. During the time of investigation, Bernie Madoff also confessed to operating a pyramid scheme as well as using a particular investment strategy called, “split-strike conversion.” This investment strategy “entails buying and selling different sorts of options to reduce volatility” (“The Madoff affair:,” 2008, para.
Alia Coleman
Grand Canyon University: BUS 340-T500A
October 27, 2013
Introduction In the business world, there are certain codes, rules, and regulations each business company or organization must abide by. Without these laws, businesses would be faced with more conflicts and complications than they already do. Large organizations have taken up certain codes to help pilot and supervise their employees and executives in attempts to avoid fraudulence. These codes are called ethics codes, or codes of conduct. Ethics codes are created to help maintain a satisfactory level of ethical behavior within a business or organization and to help companies function more successfully (Mallor, Barnes, Bowers, & Langvardt, 2013, p. 101). Codes of ethics are broken numerous amounts of times in the business world. When these codes are broken, it can lead to multiple complications and scandals for corporations. Two examples of scandal and fraud in the business world are Bernard Lawrence Madoff and ENRON.
Bernie Madoff Analysis …show more content…
He was convicted of fraud in 2008 when he admitted that his business was, in fact, the largest Ponzi scheme in history. Approximately $20 billion of, so-called, investments had dissipated (Kramer & Ward, 2009, p. 27). In the case of Bernie Madoff, there were several investigations and red flags that appeared throughout each investigation. For instance, the fact that Madoff hardly ever encountered a “down” or “slow” month even in inconsistent markets raised quite a few suspicions. During the time of investigation, Bernie Madoff also confessed to operating a pyramid scheme as well as using a particular investment strategy called, “split-strike conversion.” This investment strategy “entails buying and selling different sorts of options to reduce volatility” (“The Madoff affair:,” 2008, para.