Madoff Sentenced To 150 Years

selven was one of several readers to send in the news that Bernie Madoff was sentenced to 150 years in prison. "Bernard Madoff's victims gasped and cheered when he was sentenced to 150 years in prison, but they walked away knowing little more about how he carried out the biggest robbery in Wall Street history. In one of the most dramatic courtroom conclusions to a corporate fraud case, the 71-year-old swindler was unemotional as he was berated by distraught investors during the 90-minute proceeding. Many former clients had hoped he would shed more light on his crime and explain why he victimized so many for so long. But he did not. Madoff called his crime 'an error of judgment' and his 'failure,' reiterating previous statements that he alone was responsible for the $65 billion investment fraud. His victims said they did not hear much new from Madoff in his five-minute statement. They also said they did not believe anything he said. As he handed down the maximum penalty allowed, US District Judge Denny Chin... [said], 'I simply do not get the sense that Mr. Madoff has done all that he could or told all that he knows.'"

Comments

Re:Good... although

[Shikaku]

The message to would-be scammers is: don't get caught.

Now what about

[al0ha]

all the jackasses at the SEC that ignored data again and again which pointed to fraud and enabled him to get away with this for so many years?

Re:Now what about

[helbent]

Really. The SEC investigated him 3 times over the years and they didn't seem to catch on to the poignant fact that Madoff didn't do a single trade in the past 13 years or so. I wonder what kind of genius you have to be to have those kind of rock-solid blinders on?

Re:Now what about

[Wonko the Sane]

Greenspan, for all the harm he did, actually believed that Ayn Rand crap would work.

It would have worked if he and Congress would have allowed the large banks to actually go bankrupt when they deserved it. Failure is the ultimate regulator, unfortunately the people who fund all the reelection campaigns in this country mysteriously became "too big to fail".

Re:Now what about

[FiloEleven]

That's what FDIC insurance is for. It would have cost less than $750 billion to pay FDIC on all those accounts, and that money would have gone to people who would be more likely to spend it and "kick-start the economy" from the ground up instead of hoarding it like the bankers.

Giving more money to bankers is throwing people to the wolves.

Re:Now what about

[donj]

Sorry, but this post being moderated 5 completely discredits the competence slashdot's user base. I used to work in the financial institutions group (advising banks & insurers) of a major US Investment Bank for the last two years and witnessed the impact of the Lehman Brothers collapse on the financial system and especially other banks first hand. The global financial systems are too interlinked that ANY significant bank would have survived the collapse of even Lehman Brothers without significant government intervention - and no being a prudent bank would NOT have helped! Being prudent only impacts the asset side of the banks balance sheet i.e. a prudent bank will take less losses, however, this really doesn't help in staying solvent. The business model of banks is very simple. They borrow money from - investors - other banks - from customer deposits - central banks (repo'ing assets) add a charge (spread) on top of their funding costs (i.e. what they pay for the above) and lend it to out again. Sure, they can also trade themselves and do advisory business but borrowing and lending is really the core. Quite simply, after the Lehman collapse banks weren't able to borrow money any more: - investors were not willing to buy bank bonds any more - banks stopped lending to each other - customers withdraw money from their bank accounts - Central banks tried to relax requirements to borrow money from them but this doesn't make up for the above (moreover, this already is government intervention) This happens because investors & customers lost faith in the banking system and were afraid of another insolvency. Moreover it's a vicious circle, as soon as people are aware a bank has issues they withdraw their money making it even harder for the bank to survive. As banks have to continuously refinance themselves (as bonds they issued mature etc), not being able to borrow money any more will let a bank that is perfectly fine on the asset side go belly up within days or weeks. I've seen it, post Lehman every other week a new (PRUDENT) bank almost went bankrupt and could only survive with government intervention. You see being a prudent bank helps on the asset side and in the medium term on the liability side but in the short term after a major bank collapsed EVERY bank can go bankrupt within days given that they are extremely vulnerable on the liability side.

Re:DOOOOOOPED!

[Red Flayer]

There must have been dozens to hundreds of people orchestrating this. But it's ok, we'll pin it all on one guy and see how gullible the public is. This guy is up there with the Lee Harvey Oswalds of patsies.

I'm not sure you're aware of how the world of high-finance works. There have been hedge funds handling over $10B with FIVE employees. Seriously.

I think it's very likely that there were others in-the-know. But they probably worked out a plea to provide documentation to nail the case against Madoff, which is why they won't be prosecuted. Or Madoff is looking for redemption after perpetrating this fraud, and decided to shoulder the rap for everyone else involved. I think the last option is the most likely, and I think that his sons were who he was protecting.

But it doesn't really matter, does it? These were the extremely wealthy who were conned. As long as someone gets hanged (or imprisoned forever) we don't care. Hell, look at the swindling by Enron execs... that directly affected the retirement savings of millions of people, and in the end, we didn't really care.

As far as the general public is concerned, it's not a big deal when the wealthy steal from the wealthy. That's business by another name. And it's not a big deal when the wealthy steal from the poor -- that's business as usual. All we really care about is when the poor steal from the wealthy, because we always look down on those poorer than us, we like to imagine ourselves as wealthy, and so when the poor steal, it's an affront to our ideals.

Anyway, I'm rambling a bit... so I'll just sum up by saying: Yes, others were likely involved. Yes, he took the fall. But no one cares, as long as there's a spectacle.

They need to find the money now

[Trailer Trash]

Seriously, it's impossible to get rid of $65 Billion without having something valuable to show for it. So far they've gathered the low 9 figures of $ from him, less than 1% of the money.

Re:They need to find the money now

[jonbryce]

Most of the $65bn never existed in the first place. The rest would have been handed out to customers who had withdrawn money in the past.

The $65bn is what his clients thought they had in their accounts with him, but a lot of that can be attributed to fictitious gains that he reported on their accounts.

Re:Now here's an inconvenient truth:

[Abreu]

There are several sites I no longer bother opening links for:

digg

facebook

televisa

foxnews

Madoff is not the only one with greed

[microbee]

How about all the clients who did everything they could to have the privilege of being Madoff's clients? I mean heck what were they thinking while they saw their accounts having unbelievable returns? They might as well take some responsibilities.

No, but maybe...

[istartedi]

...it will send a message to investors.

Message? Entrusting all your money to one guy is a bad idea. It's the same message they should have received when people lost all their retirement at Enron. Yes, there were people who tried to diversify towards the end and got unfairly shut out; but they should have been diversifying all along.

The Madoff lesson is that you don't just diversify your investments, you diversify your managers. In other words, one manager who says the portfolio is diversified is not enough. You should be employing more than one manager. One of them should be YOU. You may find out that they aren't any better than you. In that case, perhaps you should simply cut them out entirely; although I'm not convinced there aren't at least some managers who are worth their fees. It's just that I've never actually met one. It's become a truism over the years that a basket of stocks meeting certain criteria will beat most managers. That's why index funds have become so popular.

Of course, this falls under the category of "good problems to have" since many in the US now have a negative or very small net worth.

Tag "republicans"

[mathx314]

Can I ask why this article is tagged "republicans"? Bernard Madoff isn't one, since he gave 88% of his political spending to the Democratic party (source). Nor is Judge Denny Chin a definite Republican (his affiliation is unknown). Alright, so some of the victims were, and probably some of the conspirators, but there's no reason this should be tagged the way it is.

Re:Good... although

[Red Flayer]

Now the message is, "if you get caught, your life is ruined."

But if you're old, and you've lived a full life, you can rest assured that your kids and your wife will still get to live a life of luxury, while you live a life of leisure in a state-run old age home. And you'll have plenty of influence to ensure you get a comfy life inside prison, since you can pay off anyone you need.

Re:Good... although

[FooAtWFU]

Speaking of his wife, there's this little piece on how Ruth Madoff Faces Living Off a Scant $2.5 Million.

Her $2.5 million settlement should give her an annual income of maybe $125,000 a year [...] That's a pretty good income. It's a lot more than many of her husband's ruined victims will have. But it will hardly support her past lifestyle. [...] The irony, of course, is that Mrs Madoff really needs right now a financial adviser she can trust to handle her money.

Re:Good... although

[computerman413]

But if you didn't lose money, it wouldn't be a scam.

Re:Tricky -- NOT

[Mprx]

In a country without socialized healthcare, fraud *is* a violent crime.

Re:Good... although

[gyrogeerloose]

I agree with your post completely but I don't think Madoff stashed most of that $65 billion in a Swiss bank account or anything else that might leave a paper trail. Since he was running a pyramid scheme, most of it probably when to pay off other investors.

Of course, he undoubtedly skimmed off a tidy sum for use by he and his spouse.

Ridiculous

[Morosoph]

5 years hell. Now come all the appeals. Is he out on bail?

This is money we're talking about. That makes for a looong sentence.

Now if he'd killed someone, you'd be right.

Re:Ridiculous

[digitalunity]

What madoff did was 100x times worse than your average 7-11 robber.

Yeah, I said it. It's worse than even a violent crime. 7-11 is insured and gets their money back, the crime is far from victimless but there is typically just 1-2 victims and they recover.

Because of madoff, thousands will suffer through the last years of their lives living from social security check to check, will not have access to the medications they need or the mobility required to live a healthy senior life.

I have no pity for the man. 150 years wasn't enough. Sadly, he will die of old age before any possible recompense can be served.

Re:Ridiculous

[Opportunist]

That's basically what bugs me about it. What's the worth of a life sentence for someone who is 77?

Given the chance, would you not do what he did? Live in luxury for 30ish years of your life, then spend the last 2-3 in prison?

What bugs me even more is that he is now found guilty, we're happy about it, and that's the last we'll hear about it. Provisions to keep this from repeating? Oversight of financial markets? Bah, what for, we got the bad guy...

Re:Tricky -- NOT

[plover]

There were at least two people who took their own lives directly because of their losses from his theft:

• Rene-Thierry Magon de la Villehuchet
• William Foxton

These men are equally as dead as any two other murder victims, and were apparently in no trouble or danger prior to Madoff's criminal activity.

And just in case you want to blame the victims, consider the phrase "danger to society" doesn't necessarily mean "physical danger". Compare what he did to a mugger pointing a gun at you, but not shooting you: you might lose $200 bucks from your wallet, you might have crapped your pants, but you're still alive, and still have a job. Causing the collapse of hundreds of businesses, the unemployment of thousands, the destruction of retirement funds of tens of thousands of people -- I'd say he ranks right up there with any weapon of mass destruction in terms of the damage done to our society. "Danger to society" isn't exclusively the province of the barrel of a gun.

Prison is exactly the right place for him to spend the next 150 years. My only complaint is that he didn't start serving it when he began his fraud, which federal investigators place about 1975. He got to live too many good years outside of the gray bars.

Re:Tricky -- NOT

[m.ducharme]

There are some sicknesses that socialized healthcare either will not cover or will not cover thoroughly enough to really cure.

Bullshit.

with socialized healthcare you get placed in "review hell" because A) the doctors get paid the same really no matter what they do

Also bullshit. In Ontario, doctors get paid per treatment/visit, more or less depending on what kind of treatment they do. No different than in the US.

and B) there are many other doctors/clinics.

I'm not even sure what the hell this has to do with anything.

If you say you need antibiotics for something, chances are in the US you can get them for whatever weak reason, with socialized healtcare if you have a non-common illness the answer will always be to wait longer.

Again, bullshit. If I need antibiotics for something, my doctor writes me a prescription for antibiotics, and I go get it filled. Of course, if I don't actually need antibiotics, my doctor doesn't have an incentive to feed me medication that I don't actually need. If you want to talk intelligently about universal or public health care, go learn something about the subject instead of repeating the lies you've been told. Here's an interesting fact for you. Of the top 40 or so countries in the world, the US has the most inefficient health care system. It's twice as inefficient as the next most inefficient health care system.

Universal public healthcare systems are operating right now, that are at least twice as efficient as the health care system in the US. Stop and think about that. This isn't theorizing about what a public health system might do, this is real actual performance in the real world. Of course, there are also many nations with fully private health care that are at least twice as efficient as your own system, which should be ringing bells in your head right about now. The problem isn't about public/private, the problem lies elsewhere. Many Americans will say that the discrepancy is caused by the "cheeseburger nation", but here in Canada we're just as obese as you are, and we do much better than you in terms of health care efficiency.

So what is the real problem? Why is it that in the US, you have absurdly high numbers of people with no coverage at all, and yet you spend more per person on health care than any other country? Follow the money....

Re:Tricky -- NOT

[modecx]

punishment
Function: noun
1 : the act of punishing
2 : a penalty (as a fine or imprisonment) inflicted on an
offender through the judicial and esp. criminal process

He's not going to prison because he's currently a danger to anyone. He's going to prison because The People decided he should be punished for his misdeeds. The People have decided that probation is just not enough punishment for destroying the pensions of thousands--maybe tens or hundreds of thousands of victims. Maybe he didn't physically assault these people--but he didn't just rob them of money, he robbed many of these people of YEARS of their hard work... Remember, some people have to get along by trading their, blood, sweat and tears; ultimately trading time for currency. When you annihilate someone's retirement account, I think an argument could be made that you're literally stealing time from their lives. Isn't that what murderers do, if more suddenly or brutally?

And before you try to use a reasoning of "setting an example" that is not justice.

The way I see it, prisons have two primary services to society: Deterrence before the act, and reformation after sentencing. You're welcome to argue their effectiveness in either of these roles (rather dismal, IMO)--but that's not the point. The point is, laws are useless unless they're backed by a set of mean and nasty, pointy teeth when it's appropriate. So what if it is "setting an example"? Maybe the prior examples just weren't harsh enough to dissuade ol' Bernie? Perhaps this might deter the next douche who starts on the path of stealing 65-70 billion, and contributing in no small part to a globally upset economy?

Re:Good... although

[Sir_Lewk]

On the contrary, I was under the impression that by the nature of his ponzi scheme he had to keep it going because the moment he stopped everyone would realize what happened. I'm not sure how you just "walk away" from thousands of investors without giving them their money (and he couldn't, their money didn't really exist, hence the scam) and not raise any alarms.