Bernie Madoff is the mastermind of the biggest investment fraud in U.S. history.

Madhoff was a Wall Street financier who was sentenced to 150 years after being convicted for what came to be the largest Ponzi scheme in financial history.

The $65 billion scam had victims from every part of society, from the poorest to the very wealthiest people in society.

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Who was Bernie Madhoff?

Madoff was born in New York in 1938 in a working-class family of immigrants from Eastern Europe.

He first started a stockbroking firm with his brother using money he had saved from working as a lifeguard and installing lawn sprinklers.

He began in the 1960s by trading penny stocks or shares of small companies.

Those companies were not listed on major stock exchanges.

Madoff’s business, which was at first legitimate, flourished.

Working with his brother and two sons, his firm went on to become one of Wall Street’s largest market makers.

It was matching buyers and sellers of stocks and was among the pioneers of computerized trading.

Madoff became a highly respected man, who used his expertise in cutting-edge technology in helping launch Nasdaq.

That was the first electronic stock exchange.

He even served as its chairman at one time.

Federal regulators looked at him as a trusted advisor.

The ‘Ponzi Scheme’

But behind his highly respectable persona, Madoff was running a complex scam.

He was pretending to trade securities and was running a serious Ponzi scheme.

He promised steady, double-digit returns to his customers while using cash from new investors to pay back money to older ones.

Madoff was able to carry on the fraud for several years while holding out against a serious recession in the 1990s, a global financial crisis in 1998, and the aftermath of the 9/11 attacks.

Throughout those years, he earned a reputation as a man of his word delivering the ‘profits’ that had been promised to his customers.

Madoff and his wife lived a life of luxury on their criminal gains.

They owned private jets, a yacht, and homes in Manhattan, Long Island, Florida, and the south of France.

It was only after the crash of 2008 that the Ponzi scheme was finally unraveled.

His investors began to pull out their money just as new sources of income dried up.

By November 2008, investors had taken out over $12 billion from Madoff accounts.

Then, Madoff confessed to his two sons about the true nature behind his business.

He reportedly told them it was “one big lie”.

They then informed authorities of the scam, and Madoff was arrested at his Manhattan penthouse in December 2008.

In total, the loss reflected by fake account statements was around $64.8 billion.

This included the profits that Madoff was sending back to customers for over at least two decades.

Court-appointed trustees have been able to recover $14 billion out of an estimated $17.5 billion that investors put into his business.

The scandal is seen as the most embarrassing failure of the Securities and Exchange Commission.

This was because it was unable to detect anything despite investigating Madoff more than six times since at least 1992.

In March 2009, the then 71-year-old Madoff pleaded guilty to several charges.

This included security fraud.

Madoff said he was “deeply sorry and ashamed.”

There was so much anger against Madoff that he would wear a bulletproof vest to court proceedings.

The court called his crimes “extraordinarily evil”, and sentenced him to the maximum possible term of 150 years in prison,

His personal property such as houses and investments was seized.

So were assets worth $80 million that his wife claimed were hers.

His brother Peter was also sentenced to 10 years in prison in 2012 and has now been released.

In 2020, after serving 11 years in prison, Madoff asked for an early release due to health problems.

He said in an interview to The Washington Post, “I’m terminally ill. There’s no cure for my type of disease. So, you know, I’ve served. I’ve served 11 years already, and, quite frankly, I’ve suffered through it.”

The same judge who had sentenced him denied the request.

The judge believed that Madoff was not “truly remorseful”, and that “he was only sorry that his life as he knew it was collapsing around him”.

He died in prison in 2021.

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