Politic?

This is a blog dedicated to a personal interpretation of political news of the day. I attempt to be as knowledgeable as possible before commenting and committing my thoughts to a day's communication.

Tuesday, June 30, 2009

Colossal Deception

Can it be attributed to inexplicable greed, that one man can enjoy the confidence of a huge number of trusting people and deliberately, utterly without conscience betray that trust? To such an unimaginable extent, that he was able, over a period of decades, to convince people who trusted him that he had safely 'invested' their savings on their behalf, to ensure the principal would be safeguarded, and would render a nice tidy profit through his knowledgeable and professional investment techniques.

Gross malfeasance of unprecedented proportions, that one man, a respected financier with a reputation for trustworthiness, backed by a professional CV that included a stint as non-executive chairman of the NASDAQ stock exchange, admitted to defrauding thousands of investors of billions of dollars. The extent of his breach of trust, of the money lost represents the largest investor fraud in American history. Bernard Madoff pleaded guilty to an eleven-count criminal complaint and was found guilty.

He was found guilty of massive fraud, and sentenced to the maximum allowable penalty, a penalty never before exacted for a white collar crime. The one hundred, fifty years in prison could never conceivably be served, but it will most certainly serve as a caution for any other fraud-oriented entrepreneurs who might want to replicate his success. At age 71, the man's balance of life will be spent as a detested convicted felon, incarcerated in the U.S. prison system, able to spend as much time as he likes thinking about his former celebrated lifestyle.

And the retirees, friends and acquaintances, charities and university endowments, royalty and celebrities whose wealth he spirited away.

Mr. Madoff was the founder of Bernard L. Madoff Investment Securities LLC. Until his arrest on December 11, 2008 he was its chairman. His company was considered one of the top market businesses on Wall Street. No one would ever have suspected he was a vulture disguised as a dove. The prevailing legend is that he 'confessed' to his sons that his company's asset management division was a collapsed criminal failure. The money he received from investors simply melted away. Earlier investors who requested their money were given later investors' funding.

There was no substance to his firm's money management, no magic technique and insider knowledge that enabled him to safeguard and grow the investments that friends, colleagues, the wealthy and the famous entrusted him with. It is estimated that he defrauded charitable groups, businesses, individuals, trusts, of the equivalent of $65-billion, an unbelievable sum. Mr. Madoff pleaded guilty to charges including securities fraud, mail fraud and money laundering. In his defence he had no defence. He characterized his defrauding adventure as an error in judgement.

When he stood before the judge to await judgement on June 29, he faced those of his victims who were present to deliver their victim impact statements and said "I know this will not help. I'm sorry." Most certainly it did nothing whatever to help the newly impoverished to face their uncertain future. He cannot take anything more away from them. On the other hand, it is entirely possible that his wife, who declares herself to have been entirely innocent of any criminal involvement, may be sued for the paltry (relatively speaking) $2.5 million she has remaining, having agreed to surrender $85-million in assets.

How believable it is that Mr. Madoff's siblings, his wife, his sons, had no idea of his criminal finagling is another story altogether. Of course federal government financial regulators also have some responsibility to own up to in this dreary tale of human failure.

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