Bernie Madoff | 60 Minutes Full Episodes
31 Aug 2024 (14 days ago)
Bernie Madoff's Fraud and SEC Inaction
- Harry Markopolos determined within five minutes that Bernie Madoff's investment strategy was fraudulent after his boss asked him to analyze it.
- Markopolos submitted information to the Securities and Exchange Commission (SEC) five times between 2000 and 2008, but no action was taken against Madoff.
- Markopolos discovered that Madoff's investment fund had not made any trades, despite Madoff's claims of using a specific trading strategy.
- Executives in Wall Street did not report Bernie Madoff to the SEC because they believed that self-regulation on Wall Street does not work.
- The SEC opened a case to investigate Bernie Madoff in January 2006, but closed it 11 months later without opening a formal investigation.
- Bernie Madoff had long-standing ties to the SEC and believed that it was virtually impossible to violate regulations and go undetected.
Madoff Family Involvement and Financial Misconduct
- Bernard Madoff's sons, Mark and Andrew, ran a legitimate trading operation and along with Madoff's brother, Peter, the chief compliance officer, took $80 million in compensation over 7 years.
- Bernard Madoff's sons, Mark and Andrew, and brother, Peter, charged millions of dollars in personal expenses to the company, including private jet rentals, ski vacations, country club dues, shopping sprees, and movie rentals.
- After 1995, Bernard Madoff's brother, Peter Madoff, only deposited $14 into his account but withdrew over $16 million.
- Bernie Madoff's sons, Mark and Andrew, worked in a legitimate trading business on the 19th floor of their father's firm, which provided a cover for Bernie Madoff's Ponzi scheme that was operated on the 17th floor.
- Ruth Madoff worked for Bernie Madoff as a bookkeeper and receptionist from 1961 to 1963 before becoming a stay-at-home mom.
Victim Compensation and Clawbacks
- Irving Picard, the trustee recovering funds for Madoff's victims, plans to sue Madoff's sons, Mark and Andrew, for $198 million, alleging they withdrew or received this amount from accounts with little to no initial investment.
- Picard is also pursuing clawbacks from "net winners," individuals who withdrew more money from Madoff's fund than they invested, to compensate victims who lost money.
- Irving Picard and his council have filed 13 lawsuits in an attempt to recover nearly $15 billion from Bernie Madoff's largest investors.
- 233 clawback notices have been sent to Madoff's friends and family who may have profited from his Ponzi scheme.
- Picard has recovered nearly $1.5 billion for the victims fund and hopes to recover several billion more.
Madoff Family's Reactions and Aftermath
- Bernie Madoff told his sons that his investment business, which was a Ponzi scheme, was insolvent and that he was broke during a family meeting on December 10, 2008.
- After Bernie Madoff confessed to his family that he had been operating a Ponzi scheme, his son Mark became enraged and left the room, followed by Andrew.
- Andrew Madoff was shocked and devastated when his father told him about the Ponzi scheme.
- Ruth Madoff asked Andrew to co-sign Bernie's $10 million bail bond, but Andrew refused.
- Ruth Madoff mailed Andrew pieces of her jewelry before she and Bernie attempted suicide by overdosing on pills.
- Andrew Madoff states that he made several million dollars during good years while running a business with his brother, Mark.
- On December 11th, 2010, Mark Madoff died by suicide.
- Ruth Madoff was devastated but not shocked when her husband, Bernie Madoff, attempted suicide.
- Ruth Madoff blames herself for her son Mark's suicide because she did not cut off contact with Bernie Madoff when Mark asked her to.
- Ruth Madoff states that she has not divorced Bernie Madoff because "he's going to die in prison" and she doesn't want to find another man.