Bernie Madoff, the criminal mastermind of the biggest investment fraud in US history died in prison Wednesday at age 82. The Federal Bureau of Prisons confirmed his death at the Federal Medical Center in Butner, North Carolina, was confirmed by the federal Bureau of Prisons.
He died apparently from natural causes. Bernie Madoff, serving a 150-year sentence, suffered from terminal kidney disease. Despite his condition, officials denied an earlier request for compassionate release.
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$65 Billion Swindle
The courts convicted the one-time Wall Street darling of fraud, reportedly bilking tens of thousands of clients totaling $65 billion. He pled guilty to the charges of defrauding more than $40,000 people in 125 countries in over four decades of dealing.
Victims included some of the most famous and richest people in the world, including Steven Spielberg, Kevin Bacon, Mets owner Fred Wilpon, Hall of Famer Sandy Koufax, and Nobel Peace Prize winner Elie Weisel.
Based on investigations, Bernie Madoff never worked on his clients’ investments for years. Instead of delivering his promised split-strike conversion strategy, he simply deposited investors' money into a Chase bank account and paid newer customers with money from older customers.
Then, he submitted falsified account statements. In fact, the $50 billion that supposedly made interest was actually all made up. The fraud unraveled in 2008 when Madoff’s own sons turned him in.
Shattered Investor Confidence
The Bernard L. Madoff Investment Securities scandal shattered investor confidence in the wake of the financial crisis during 2008. The Securities and Exchange Commission instituted sweeping changes to its offices, as it did not notice the fraud happening under their noses until the very end.
The SEC did receive warnings from independent investigator Harry Markopolos. Markopolos found it hard to believe Madoff’s improbable returns and accused Madoff off fraud as early as 2000.
The SEC then undertook a subsequent investigation led by the agency’s inspector general, H. David Kotz. Despite some clear proof of fraud, SEC officials sided with Madoff and believed he operated legitimately.
“When Madoff provided evasive or contradictory answers to important questions in testimony, they simply accepted as plausible his explanations,” Kotz wrote.
Last year, the con artists asked a judge to release him, saying he was dying from kidney disease and will no longer qualify for transplants. “You know there hasn’t been a day in prison that I haven’t felt the guilt for the pain I caused on the victims and for my family,” he told The Washington Post at the time. He said the goal is to explain his actions to his grandchildren.
“You know I lost both my sons and my wife is not really well. So it’s horrible,” he told the Post. “I was very close with my family. I made a terrible mistake. And you know I suffer with it.
I’ll suffer with it when I get out.” Four months later, a judge denied the request, saying Madoff committed “one of the most egregious financial crimes of all time,” and that “many people are still suffering.”
Big Shot On Wall Street
For over 50 years, Bernie Madoff owned Wall Street. He spawned a legend as a big money manager who started his own firm at age 22. Along the way, he became executive chairman of Nasdaq in 1990 and was credited for helping build modern electronic trading.
The big lie came to a crashing end during the 2008 financial crisis as many clients tried to cash out. With nothing to show for the investments, Madoff confessed to his sons Mark and Andrew that he has nothing to return to clients.
Realizing the extent of the damage their father made, the two sons alerted the authorities. A day later the FBI raided Bernie Madoff’s offices in Manhattan and arrested him.
During the subsequent trial, Madoff pled guilty to 11 federal crimes and admitted operating the biggest Ponzi scheme. Judges gave him 150 years in prison and a restitution bill of $170 billion.
Watch the NBC News video reporting that infamous fraudster Bernie Madoff dead in prison at 82:
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