Essay on Bernie Madoff

1989 Words Aug 18th, 2012 8 Pages
Bernie Madoff
Andrea L. Nolt
Strayer University
Intro to Business
Professor Karina Arzumanova
August 21, 2011

Bernie Madoff

Bernard Lawrence “Bernie Madoff” is an American former stock broker, investment adviser, non-executive chairman of the NASDAQ stock market, and the admitted operator of what has been described as the largest Ponzi scheme in history. (Bernard Madoff, 2011) This paper discusses the massive Ponzi scheme that Mr. Madoff created and those that were affected by it.

1. Describe three types of illegal business behavior alleged against Mr. Madoff and for each type of behavior, explain how the behavior is illegal or unethical in the conduct of business.
Madoff reportedly admitted to investigators that he had
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As the scheme began to collapse, it became evident that the returns that he was paying investors were not actually returns and that he had never invested their money. Many investors used their life savings banking on Mr. Madoff's promise of a comfy retirement and then were left with nothing. Some of these people were left to file bankruptcy and hope to eventually gain some of their investment back through lawsuits. Many banks lost millions of dollars in Madoff's Ponzi scheme as well. Banks invested their funds in Madoff's securities company in the millions.
Many charities also invested their funds with Mr. Madoff hoping to make his promised returns on their money. Many of these charities ended up going bankrupt. Many of the investors allegedly swindled by Wall Street money manager Bernard Madoff are, like him, Jewish, and for many of them, contributing to Jewish causes is a crucial part of their culture. (Noveck, 2008) Jewish philanthropy losses were estimated to be between $600 million and $1 billion. This also had a major impact psychologically. These people were betrayed by one of their own.
Madoff's family were also impacted by this scheme. Both of his sons were hired on the so-called legitimate side of the business. Both claimed to know nothing of their father's illegal activities. After their father admitted to the scheme, they supposedly never spoke to him again. Two years after his father's arrest, Madoff's oldest son hung himself in his home, not able to

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