Bernard Madoff, at one time chairman of NASDAQ and the head of one of the top market maker business on Wall Street, as well as the founder of an investment fund that bore his name, died in prison on Wednesday, April 14, in Butler, North Carolina.
In the final great scandal of a scandalous year for the world of finance, on December 9, 2008, Madoff confessed to his sons that there was no money available for paying the clients of his investment business, that the fund had just been “one big lie,” a gigantic Ponzi scheme involving billions of dollars. His sons immediately consulted lawyers, upon whose insistence they then informed federal authorities of their father’s confession. So on December 11, the authorities arrested Madoff.
The Thing to Know:
Madoff pleaded guilty to 11 federal felonies in connection with this scheme on March 12, 2009. He said in his confession that the transition of his fund, founded in 1960, from a legitimate business into a Ponzi scheme had taken place in the 1990s. Most of those who have looked into the matter are skeptical that it was so recent. Some place it in the 1970s. By any reading, even if the scheme were a fraud for “only” ten years before its collapse, its scale was breathtaking.