'Bernard Madoff:
Wall Street Swindler Strikes Powerful Blows for Social Justice
Wall Street Swindler Strikes Powerful Blows for Social Justice
By James Petras
“We never thought he would do this to us, he was one of our people”, member of Palm Beach Country Club.
December 22, 2008 "Information Clearinghouse" ---
“We never thought he would do this to us, he was one of our people”, member of Palm Beach Country Club.
December 22, 2008 "Information Clearinghouse" ---
Wall Street broker Bernard (‘Bernie’) Madoff, former president of NASDAQ, revered and respected investor confessed to pulling off the biggest fraud in history, a $50 billion dollar scam. Bernie was known for his generous philanthropy, especially to Zionist, Jewish and Israeli causes. A one time life-guard on Long Island in the 1960’s, Bernie launched his financial career by raising money from colleagues, friends and relatives among wealthier Jews in the Long Island suburbs, Palm Beach, Florida and in Manhattan, promising a modest, steady and secure return of between 10 to 12%, covering any withdrawals in typical Ponzi fashion by drawing on funds from new investors who literally pleaded for Bernie to fleece them. Madoff personally managed at least $17 billion dollars. For almost four decades he built up a clientele, which came to include some of the biggest banks and investment houses in Scotland, Spain, England and France; as well as major hedge funds in the United States. Madoff drew almost all of the funds from high net-worth private clients who were recruited by brokers working on commission. Bernie’s clients included many multi-millionaires and billionaires from Switzerland, Israel and elsewhere, as well as the US’s largest hedge funds (RMF Division of the Man Group and the Tremont). Many of the swindled super-rich clients forced their money on Madoff, who sternly imposed rigorous conditions on potential clients: He insisted they have recommendations from existing investors, deposit a substantial amount and guarantee their own solvency. Most considered themselves lucky to have their funds taken by the highly respected Wall Street…swindler. Madoff’s standard message was that the fund was closed…but because they came from the same world (board members of Jewish charities, pro-Israel fund raising organizations or the ‘right’ country clubs) or were related to a friend, colleague or existing clients, he would take their money.
Madoff set up advisory councils with distinguished members, contributed heavily to museums, hospitals and upscale cultural organizations. He was a prominent member of exclusive country clubs in Palm Beach and Long Island. His reputation was enhanced by his funds record of never having a losing year – a big selling point in luring millionaire investors. Madoff shared with his super-rich clients (Jews and Gentiles) a common upper class life style, and mix of cultural philanthropy with low key financial profiteering. Madoff ‘played’ his colleagues with a soft-spoken, but authoritative, appearance of ‘expertise’, covered by a veneer of upper class collegiality, deep commitment to Zionism and long-term friendships.
Bernie’s mega-fund shared many signs with recent high level scams: The constant high returns, unmatched by any other broker; a lack of third party oversight; a backroom accounting firm physically incapable of auditing the multi-billion dollar operation; a broker-dealer operation directly under his thumb and the total obfuscation of what he was actually investing in. The obvious similarity of signs with other fraudsters were overlooked by the rich and famous, the sophisticated investors and high paid consultants, the Harvard MBA’s and the entire army of regulators from the Security and Exchange Commissions (SEC) because they were totally embedded in the corrupt culture of ‘take the money and run’ and ‘if you’re making it, don’t ask questions’. The reputation of the superior wisdom of a seemingly successful Jewish Wall Streeter fed into the self-delusions of the wealthy and the stereotypes held by millionaire Gentiles.
The Big Swindle
Madoff’s investment fund only dealt with a limited clientele of multi-millionaire and billionaires who kept their funds in for the long haul; the occasional withdrawal were limited in amount and were easily covered by soliciting new funds from new investors fighting to have access to Madoff’s money management. The long-term big investors looked toward passing their investments to their kin or eventual retirement. The wealthy lawyers, dentists, surgeons, distinguished Ivy league professors and others who might need to draw from their funds for an occasional fancy wedding or celebrity-studded bar-mitzvah, could draw from their funds because Madoff had no problem covering the withdrawal by attracting funds from rich owners of sweat shop garment factories, dangerous meat packing outfits and slumlords. Madoff was no Robin Hood, his philanthropic and charity contributions facilitated access to the rich and wealthy who served on the boards of the recipient institutions and proved that he was ‘one of them’ a kind of super-rich ‘intimate’ of the same elite class. The shock, awe and heart attacks that followed Madoff’s confession that he was ‘running a Ponzi scheme’ drew as much anger for the money lost and the fall from the moneyed class as for the embarrassment of knowing that the world’s biggest exploiters and smartest swindlers on Wall Street, were completely ‘taken’ by one of their own. Not only did they suffer big losses but their self-image of themselves as rich because they are so smart and of ‘superior stock’ was utterly shattered: They saw themselves as suffering the same fate as all the schmucks they had previously swindled, exploited and dispossessed in their climb to the top. There is nothing worse for the ego of a respectable swindler than to be trumped by a bigger swindler. As a result, a number of the biggest losers have so far refused to give their names or the amount they lost, working instead through lawyers fighting off other losers.
The Positive Side of Madoff’s Mega-Swindle (The Inadvertent Hand of Justice)'
Madoff set up advisory councils with distinguished members, contributed heavily to museums, hospitals and upscale cultural organizations. He was a prominent member of exclusive country clubs in Palm Beach and Long Island. His reputation was enhanced by his funds record of never having a losing year – a big selling point in luring millionaire investors. Madoff shared with his super-rich clients (Jews and Gentiles) a common upper class life style, and mix of cultural philanthropy with low key financial profiteering. Madoff ‘played’ his colleagues with a soft-spoken, but authoritative, appearance of ‘expertise’, covered by a veneer of upper class collegiality, deep commitment to Zionism and long-term friendships.
Bernie’s mega-fund shared many signs with recent high level scams: The constant high returns, unmatched by any other broker; a lack of third party oversight; a backroom accounting firm physically incapable of auditing the multi-billion dollar operation; a broker-dealer operation directly under his thumb and the total obfuscation of what he was actually investing in. The obvious similarity of signs with other fraudsters were overlooked by the rich and famous, the sophisticated investors and high paid consultants, the Harvard MBA’s and the entire army of regulators from the Security and Exchange Commissions (SEC) because they were totally embedded in the corrupt culture of ‘take the money and run’ and ‘if you’re making it, don’t ask questions’. The reputation of the superior wisdom of a seemingly successful Jewish Wall Streeter fed into the self-delusions of the wealthy and the stereotypes held by millionaire Gentiles.
The Big Swindle
Madoff’s investment fund only dealt with a limited clientele of multi-millionaire and billionaires who kept their funds in for the long haul; the occasional withdrawal were limited in amount and were easily covered by soliciting new funds from new investors fighting to have access to Madoff’s money management. The long-term big investors looked toward passing their investments to their kin or eventual retirement. The wealthy lawyers, dentists, surgeons, distinguished Ivy league professors and others who might need to draw from their funds for an occasional fancy wedding or celebrity-studded bar-mitzvah, could draw from their funds because Madoff had no problem covering the withdrawal by attracting funds from rich owners of sweat shop garment factories, dangerous meat packing outfits and slumlords. Madoff was no Robin Hood, his philanthropic and charity contributions facilitated access to the rich and wealthy who served on the boards of the recipient institutions and proved that he was ‘one of them’ a kind of super-rich ‘intimate’ of the same elite class. The shock, awe and heart attacks that followed Madoff’s confession that he was ‘running a Ponzi scheme’ drew as much anger for the money lost and the fall from the moneyed class as for the embarrassment of knowing that the world’s biggest exploiters and smartest swindlers on Wall Street, were completely ‘taken’ by one of their own. Not only did they suffer big losses but their self-image of themselves as rich because they are so smart and of ‘superior stock’ was utterly shattered: They saw themselves as suffering the same fate as all the schmucks they had previously swindled, exploited and dispossessed in their climb to the top. There is nothing worse for the ego of a respectable swindler than to be trumped by a bigger swindler. As a result, a number of the biggest losers have so far refused to give their names or the amount they lost, working instead through lawyers fighting off other losers.
The Positive Side of Madoff’s Mega-Swindle (The Inadvertent Hand of Justice)'
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