Bernie Madoff, the financier who built the largest Ponzi scheme in history, died in the federal prison in Butner, North Carolina, where he was serving his sentence. On April 29, he would have turned 83 years old. Last year his lawyers had asked to have him placed under house arrest due to his poor health related to severe kidney disease, indicating he was only 18 months old, but the request had been denied in court. Madoff was serving a 150-year sentence.
A scam with 37,000 victims (including Spielberg)
In 2009, he pleaded guilty to a fraud that affected up to 37,000 people in 136 countries over four decades, until the end of 2008. Among his victims, including celebrities such as director Steven Spielberg, actor Kevin Bacon and Nobel Peace Prize winner Elie Wiesel. The scam he had concocted was worth over 60 billion dollars, probably one of the largest in the world: he had been running it for years and no one, neither the authorities nor the investors, had ever noticed. The 64.8 billion was the figure reported on the paper by Madoff in the falsified documents to his customers; investors, sometimes famous, had entrusted him with at least 17.5 billion over the years and the judiciary has to date recovered about 13 billion of the stolen goods.
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As a lifeguard on Nasdaq
Born on April 29, 1938, Madoff founded his first company in 1960 by investing $ 5,000 earned as a lifeguard on the beach. Madoff had then been president of Nasdaq, the technology list, to which he had managed to attract leading companies such as Apple, Sun Microsystems, Google and Cisco System. The position held had earned him an excellent reputation and therefore an almost unconditional trust, on which he based the scam.
The “chain” that ensures earnings for the first investors
The Wall Street crisis of 2008, however, bent Madoff’s almost perfect scheme, when large funds and other institutional players began to quickly withdraw capital from accounts opened with Madoff, exposing the scam scheme and forcing him to confess to his children that the company’s luck was false. His “scheme”, the promise of investments with stellar profits, allows those who start the chain and the first involved to obtain high economic returns in the short term, but continually requires new victims willing to pay: the gains come in fact only from the shares paid by new investors and not by productive or financial activities.