Bernie Madoff, from billionaire to 150 years in prison: biggest scam in history, bankrupt celebrities, suicides and one regret

“I left a legacy of shame on my family and my grandchildren. This is something that I will wear for the rest of my life. And I’m sorry”. Exactly twelve years ago, the financier Bernard madoff pleaded guilty to the biggest scam in history in Manhattan Federal Court. His own sons, Mark and Andrew, had handed him over to the authorities in December 2008, when he revealed to them that the pyramid fraud he had suffered since 1992 had exploded in his hands, leaving a hole in 65,000 million US dollars.

He was then under house arrest for fourteen months in his luxurious apartment on the Upper East Side of New York, but now he would be transferred to a joint prison. The man who had been considered a market guru for the rich and famous who have entrusted him with their fortunes on five continentss was about to be sentenced to 150 years in prison. At 70, he knew he would spend the rest of his life behind bars, but part of him felt relief: the constant pressure had become intolerable. “I couldn’t wait for everything to explode”, he would confess later.

“Imagine coming home every night and not being able to tell your wife, living with that guillotine over your head without telling your kids, your brother, seeing them in the office every day and not being able to be confident with what’s going on, ”Madoff said in a series of conversations with the journalist and editor of the magazine. new York Steve Fishman from his cell at a North Carolina correctional facility, when his family’s tragedy was already over. What he had hidden from them for years was that the benefits he brought to his clients did not come from operations, but from what new investors brought in: paid the income of the first with the income of the new. A manual Ponzi scheme.

To ensure the proper functioning of the system, two conditions had to be met. The first was that unlimited customers will be added. Madoff enjoyed prestige and recognition in international stock markets, so money flowed and clients put their savings at risk. The second condition was that not everyone wants to withdraw their funds all at once. But with the real estate bubble burst This triggered the Great Recession, investors wanted to get their savings back. In the midst of the biggest crisis after Crack of 29, there were no new customers either.

Thus, the two ground rules that had kept the system in place for at least 16 years were broken. And with that, the lives of savers around the world and of Madoff himself. After denouncing him, his sons Mark and Andrew did not speak to him again.

His wife, Ruth, had to choose between them and her husband. He chose his partner of more than five decades, until December 11, 2010, on the second anniversary of the arrest of his father, Mark, 46, Clung to the dog’s leash in his Soho attic. It was a final message to her father after publicly revealing it as a fraud: her family was too.

Ruth also stopped talking to the Patriarch, but she was already doomed to loneliness: her stepdaughter wouldn’t allow her to enter Mark’s funeral or see her grandchildren, no one wanted her. Her youngest son, Andrew, has not spoken to her again. Have you ever told your friends that your father was a “Talented manipulator” who raised them through intimidation. “My anger towards him, far from dissipating with time, has metastasized”, I trust them. He died of lymphoma in September 2014.

They had been “a tight-knit family, a family business,” as Madoff himself recalls in his conversations with Fishman. They could be seen on one of their four yachts on the beaches of Palm Beach, vacationing at their summer home in Montauk, at fundraising galas, playing golf or having lunch at the exclusive clubs that Bernie and Ruth were dating. In 2011, she confessed in an interview with The New York Times that also they had taken pills together two weeks after her husband’s arrest, while he was under house arrest, at Christmas 2008: “We wanted to end it all.” The dose was not sufficient. He will say later that he woke up the next morning thinking he couldn’t leave his family.

The sociopath and a chain of suicides

Madoff’s lies to his most intimate surroundings, and the weight and difficulty of keeping his crimes a secret over the years, have at times called into question the extent to which the scam could have been carried out without his complicity. But if that could never be proven, the drama and chain of deaths that caused the explosion of this other personal bubble ended up giving a real dimension to how far the financier was able to go with his narcissism. It’s finally the only thing he regrets: “I destroyed my family”, he said in his interview with Fishman now available on the Ponzi Supernova podcast (2017).

For his other victims, he never showed empathy. “They say I’m a sociopath, but I’m a good person. I confessed everything I did, ”apologizes during conversations Madoff, who founded his firm in 1960 with his savings as a lifeguard on the beaches of Long Island and a loan from her stepfather. According to him, it was only in the 90s that he started with the pyramid scam, and it started “as something temporary”. He had underperformed on some investments and used the capital of his new clients to cover the shortfall and distribute it as a return.

When it was all discovered, he also learned to distribute the blame: “Banks and funds must have known there was a problem because I never told them where I got the benefits. I refused and told them that if they didn’t like it, they would take their money, which they obviously didn’t ”.

On December 22, 2008, barely a week and a half after the discovery of the fraud, Thierry de Villehuchet, a 65-year-old French aristocrat and founder of management company Access International, cut his wrists in his New York office. He had lost between $ 1.5 billion and $ 2 billion to the Madoff scam – his money and that of his clients. He believed in the promises of good returns and entrusted him with 75% of his portfolio. Liliane Bettencourt, the heir to the L’Oréal empire and who was the richest woman in the world, had put part of her fortune in Villehuchet’s hands: she ended up being one of those scammed by Madoff .

Two months later the suicide of the English veteran William Foxton, showed the diversity of the drama of the victims. Foxton was an officer of the Order of the British Empire who had lost your family savings in the Madoff trellis. Shot himself in the head in a park near his home in Southampton. “I want him to see people who died for what he did,” his son said in an ABC interview.

Madoff, however, has gathered his own truth to live with. It was what he had always done. “They came to get me to invest with me, because they made money with me,” he boasted of prison. I told them not to invest more than they could afford to lose: “It’s the stock market, it can fail. I can do something stupid myself. Everyone has it, but they’re all greedy. It is not an excuse, but it is what happened ”.

Although at the time of his conviction, Madoff said he was sorry, the journalist who knows him best, Fishman, believes that the one who was president of the Nasdaq has “an equivocal relationship with remorse.” “His position is that he helped a lot of people earn a lot of money and ended up getting caught by them,” the reporter said. MarketWatch-. If you feel guilty it is for destroying your career and your family, not the fate of your victims“.

Until some time ago, Madoff seemed fairly comfortable in prison. “I wish they’d caught me sooner,” he says of Ponzi Supernova. According to Fishman, this has not just to do with the relief of no longer having to hide the fraud, but with the treatment of other inmates. “He’s a star in prison. He stole more money than anyone in history and, to other thieves, that makes him a hero – they even ask him for financial advice, ”he says.

He came to buy all the chocolate stock in the criminal’s cup to monopolize it and speculate on the price. “If you wanted hot chocolate, you had to go through Bernie,” Fishman says. The man who invented an empire with just $ 500 had found a way to recreate the market game even behind bars. This time without the risk of being arrested, although at some point ended up in the infirmary after a fist fight with a partner who may not have been happy with their earnings. The law of prison.

Old and terminal, Madoff had irreversible kidney failure for which he was serving his sentence in a hospital unit. In February 2020, he asked to spend his last months under house arrest. Justice denied it: it is a compassion that, they say, the greatest crook in history did not have for his victims.

He passed away on Wednesday. He was 82 years old.

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