Bernard Lawrence Madoff, the brain behind the largest Ponzi scheme in American history, was born in 1938 during a depressing era. America just went through the Great Depression and was now headed into World War II. The Madoff family was Jewish, and Bernie grew up in a prodominitly Jewish community in Queens, New York. In high school, Bernie Madoff met his future wife, Ruth Alpern. Bernie and Ruth Madoff had two sons, Mark and Andrew.
Madoff’s scam started through an affinity bunko scam, which led to an enormous Ponzi scheme. Most affinity criminals target “victims who are linked to them by religion or ethnic background” (Rosoff, Pontell, & Tillman, 2014, p. 40). A Ponzi scheme is when a con-artist pays their first group of investors with their own money, while gaining new investors. The fraudster must continually gain new investors in order to keep his perpetual scheme going. As the amount of people being deceived increases, the con-artist has more money to splurge on himself. Ponzi schemes usually end when too many investors want their money back and the fraudster is unable to pay them all or he cannot find any new investors.
Bernie Madoff used his Jewish heritage to connect with other Jews and gain their confidence in him. By believing in his own power of confidence, Bernie Madoff convinced his targets that he was rich, powerful, intelligent, and could make them wealthy. Madoff promised to invest his targets’ money and in the beginning used his own money to pay the investors their interest. After the events of the recent trial, there was evidence proving Bernie Madoff’s despicable scheme dated back to the early 1970s, but no one has been able to find an exact time when Bernie began collecting funds for fake investments.
Madoff’s company, Bernard L. Madoff Investment Securities LLC, was located on the 17th through 19th floors of the Lipstick Building in Manhattan, New York. On the 19th floor, actual stock-trades were made everyday; the 18th floor housed paperwork for the 19th floor’s transactions; and the 17th floor was top secret. Access to this floor was limited to Bernie Madoff and a select group of people. This floor was where the fraud took place. About two dozen employees, produced fake trade receipts for Madoff’s investors on outdated computers and printers. Bernie Madoff’s extensive client list was not discriminatory. It included a few famous names (such as: Kevin Bacon, Kyra Sedgwick, and Steven Spielburg); many charitable organizations; and multiple financial firms.
Many people have speculated Madoff’s reasoning behind his decision to commit fraud. One article stated he was “a greedy manipulator so hungry to accumulate wealth that he did not care whom he hurt to get what he wanted” (Creswell & Thomas, 2009). The obvious motivation is greed; however, was it just greed for monetary gain or the power that money brings?
Regardless of his rationale, Bernie Madoff was an egomaniac, who convinced a vast amount of people he was investing...