The US Bureau of Prisons has announced the death of disgraced financier Bernie Madoff. Mr. Madoff had been serving a 150-year sentence after pleading guilty in 2009 to running what was effectively a Ponzi scheme.
Using this scheme, Mr. Madoff would pay off existing investors with money from new clients. The scheme collapsed in the 2008 financial crisis when investors, hit by the downturn, tried to withdraw around $7 billion, which the fund couldn’t cover.
Last year Mr. Madoff requested an early release from prison because he was terminally ill with kidney disease. Judge Denny Chin refused the request on the grounds that many of Madoff’s victims were still struggling as the result of the losses they suffered.
In his summary, Judge Chin wrote – “I also believe that Mr. Madoff was never truly remorseful and that he was only sorry that his life as he knew it was collapsing around him.”
His lawyer, Brandon Sample, released a statement in which he said – “Bernie, up until his death, lived with guilt and remorse for his crimes. Although the crimes Bernie was convicted of have come to define who he was – he was also a father and a husband. He was soft-spoken and an intellectual. Bernie was by no means perfect. But no man is.”
The rise and fall of Bernie Madoff
Before it all unraveled Bernie Madoff seemed to be the epitome of the American dream. He grew up in New York, the son of European immigrants, and set up his firm, Bernie Madoff Investment Securities, in 1960.
The firm became one of the largest market-makers while he also served as Chairman of the Nasdaq stock exchange. Because of the exceptional returns that his investments offered, he was investigated eight times by the US Securities and Exchange Commission. Despite this, the scheme wasn’t discovered until the global recession of 2008.
When investors tried to pull $7 billion from his funds, he simply didn’t have the cash to cover it. The recession meant he also lost access to the stream of new investors desperate to get on the “Bernie Train.”
It was only then that he admitted the situation to his sons, who reported it to the authorities.
In total, he had defrauded almost $65 billion from his investors.
Who did he steal from?
The list of people and institutions that lost out to the scam includes major banks and financial institutions the world over. Hollywood and sports stars, and the ordinary man and the woman in the street. Mechanics, farmers, and schoolteachers were all counted amongst the victims.
At least two investors took their own lives after their losses. Mark Madoff, Bernie’s son, also killed himself on the second anniversary of his father’s arrest. His remaining son, Andrew, died of cancer in 2014.
He is survived by his wife, Ruth, who has always maintained her own innocence, saying she knew nothing of the scheme. Prosecutors allowed her to keep $2.5 million from the $825 million fortune that Bernie had accrued.