In the 1960’s Bernie Madoff took money from mainly Jewish businessmen at exclusive country clubs with the promise that they would see steady returns on their investments, the returns promised were above the market average but not enough to have been considered wholly unrealistic and arise suspicion. He later spread his wings and moved into Europe and Latin America, taking money from powerful hedge funds and feeder funds with the same promises of steady returns – billions of dollars were invested in this rising star and his ‘feeders’ made themselves rich selling his promises.
Madoff’s competitors were always curious how Madoff could produce such steady returns, especially through periods of market volatility, and several times they reported Madoff to SEC with allegations that he must have been running a ponzi scheme. The SEC investigated several times over two decades but remained untouched until December 2008 when faced with an increase in customers seeking a return of their funds that he admitted it had all been one big lie and he had indeed been running the biggest ever ponzi scheme for four decades. It was a scandal which lasted longer and cut deeper than any other in history.
The Madoff Affair is a 2009 PBS Frontline documentary which tells the story of Bernie Madoff’s record $65 billion deception and explains how Madoff was able to keep up the lie for so long, the documentary won a 2009 Emmy Award. Also worth a watch on the subject is the History Channel documentary Madoff and the Scamming of America (2009).
There have been numerous books about the Madoff scandal, but perhaps the most definitive and best received is the bestselling book The Wizard of Lies: Bernie Madoff and the Death of Trust. This book, written by New York Times journalist Diana B. Henriques, was later turned into an HBO film starring Robert De Niro.