Largest Ponzi Scheme now at $50 Billion

Discussion in 'Politics, Religion, Social Issues' started by Sun Baked, Dec 11, 2008.

  1. Sun Baked macrumors G5

    Sun Baked

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    #1
    http://www.sec.gov/news/press/2008/2008-293.htm

    http://www.nytimes.com/2008/12/12/business/12scheme.html?ref=business

    Wow, over 10 times larger than 2nd place.
     
  2. angelneo macrumors 68000

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    #2
    Wow, another blow to the crippling economy. I wonder how long before all the crap get blown sky high
     
  3. Consultant macrumors G5

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    #3
    Wow, I am surprised they let this guy out on bail. If he can perpetuate such fraud, he probably has some funds diverted somewhere.
     
  4. Sun Baked thread starter macrumors G5

    Sun Baked

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    #4
    Actually it looked like he did, and was in the process of doing it when he was arrested.

    Idiot told employees that he had some cash left, and was going to divert it.

    The speed at which he was arrested, almost makes it sound like an employee turned him in.
    Can you imagine the surprise on your face if you got a million dollar Christmas bonus, blew it, and had the FBI come asking for it back during the new year.
     
  5. Blue Velvet Moderator emeritus

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    Let's deregulate them even more, bail them out and cut their taxes. Enlightened self-interest, my arse.
     
  6. Sun Baked thread starter macrumors G5

    Sun Baked

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    #6
    The ripples from this seems to be hammering how some of the hedge funds were operated, with them not even bothering to invest the money themselves, but take a huge fee for managing it and hand the money over to another manager or group of them.
     
  7. kavika411 macrumors 6502a

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    #7
    If I am not mistaken, he was actually turned in by his two sons.
     
  8. Queso macrumors G4

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    #8
    I'll put money* on there being no hedge funds at all before the end of the year.



    * Euros for the moment, Dollars tomorrow, probably Swiss Francs by the weekend...
     
  9. Dont Hurt Me macrumors 603

    Dont Hurt Me

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    #9
    Where's loudmouth Newt Gingrich? He did lobby congress for deregulation on these guys after he was kicked out of congress. A 6 figure contract! maybe a slightly more socialist system wouldnt be bad for the U.S. since the republicans refuse to regulate themself.

    It must be stated Bush has removed the sentence that would have limited these rich guys bonus $$$. Wont be voting republican this decade,maybe not the next.
     
  10. Sun Baked thread starter macrumors G5

    Sun Baked

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    #10
    Though we didn't find that out until later.

    Here son, have a bonus, and then when asked why he coughed up the story.

    And was arrested the next day.
     
  11. CorvusCamenarum macrumors 65816

    CorvusCamenarum

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  12. 63dot macrumors 603

    63dot

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    #12
    who is he attached to? foreign government, group, company?
     
  13. Desertrat macrumors newbie

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    #13
    The sad part, to me, is that there are (now, "were") wealthy folks who let this (bleep) handle their entire investment portfolios. That impacts whole families, down to the kids and grandkids...
     
  14. Sun Baked thread starter macrumors G5

    Sun Baked

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    #14
    Even the people that got out awhile ago are the targets for the lawyers of current victims, as they look back years to strip people of ill gotten gains.

    With these red flags going way back to 1999, the look back period authorized by the court could be asking grandkids to pay back their spent inheritance of ill gotten gains.

    aka, should be as ugly a case as the Enron bankruptcy.
     
  15. fivepoint macrumors 65816

    fivepoint

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    #15
    I thought the LARGEST Ponzi scheme was social security. ;)

    [​IMG]
     
  16. 63dot macrumors 603

    63dot

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    #16
    It works for everybody, except my generation, the pig in the python, the holders of the roll of the toilet paper, aka the baby boomers. :)
     
  17. Dont Hurt Me macrumors 603

    Dont Hurt Me

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    This guy is walking around, how does someone who rips off people of 50 billion walk free yet someone who steals a loaf of bread does time? our system is 100% broke.

    I bet this guy has millions tucked away in many shoeboxes all across the world.

    White collar crime isnt a crime it appears. Madoff should be in a cold jail period.
     
  18. 63dot macrumors 603

    63dot

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    #18
    It's funny reading about more famous controversial guys like Milken and Icahn and not hearing much, if at all, about Madoff. All the news is certainly not out, but his dealings appear, at least for now, to reach beyond the scope of either guy, junk bond king and takeover king.

    What will people call Madoff? Or what will people call the Ponzi Scheme, the Madoff "with your money" Scheme? :)

    Madoff's dealings are so big in scope they are far beyond Ponzi or Pyramid by traditional definiton/example, and approach the concept of market control via Bubble, or should I say Madoff Bubble as I am sure a term will develop from this big story. Pyramids and Ponzis can be controlled by one person, but not a bubble. No way, right? This may set a new precedent. But it's still hard to imagine "one person" exacting that much control.

    Just read the NY Times story on Madoff today and it's only the tip of the iceberg.
     
  19. GfPQqmcRKUvP macrumors 68040

    GfPQqmcRKUvP

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    #19
    No one is suggesting deregulating criminals, bailing them out, and cutting their taxes.
     
  20. 63dot macrumors 603

    63dot

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    Hey, Milken was out in less than two years, and I can't find any info on Icahn ever having done time, but only "settling" out of court. But if I am wrong, please somebody give me a link on Milken or Icahn. And remember Ivan Boesky? Two years then free.

    But maybe Madoff is just too big to just let off the hook, especially in recessionary times. But if Madoff is as powerful as he appears, he may not do time or settle, but have a few weeks of "house arrest".

    Without knowing all the facts of either of the four people mentioned, playing devil's advocate for a second, what laws did anyone break or did any of these men commit a crime(s)? Are those laws fair? And weren't any of these giants in business, and let's throw in Bill Gates and Jerry Yang into the mix, just doing business like any of us, but just on a bigger scale?

    Anyway, allegations and descriptions of white collar crimes are probably far more complex than most of us may understand, but are crimes nonetheless. If the justice system is fair, Madoff will do serious time.
     
  21. Sun Baked thread starter macrumors G5

    Sun Baked

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    Well Eliot Spitzer's year is getting worse for him, his family's real estate firm invested with Madoff.

    And since he is refusing to disclose the damage, it is likely really painful.

    Seems all his crusades against prostitutes and investment fraud have turn around to take a rather large chunk out of his ass and life.
     
  22. iJohnHenry macrumors P6

    iJohnHenry

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    #22
    Not any more, he isn't.

    The judge has ordered him confined under house arrest, 24/7, with an electronic ankle bracelet.

    "In his penthouse apartment in the sky."

    He also has guards, due to death threats via E-mail.

    Some very rich people are very unhappy. Surely some of them are of the bent-nose persuasion. ;)
     
  23. 63dot macrumors 603

    63dot

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    #23
    Those guards are also there to keep him from attempting to flee.

    Dreamworks has thrown a whopper of a suit against Madoff. What makes me angry is that Madoff stole from Holocaust Memorial organizations, and he himself is Jewish. That would be like Dr. Phil swindling the APA, or Steve Jobs swindling Apple. This is a very sad situation and may be a product of Bush de-regulation.

    If Madoff was Bonnie, then GOP financial industry deregulation was Clyde. Both must pay up. And I am talking to you, John, Mr. John McCain. :)
     
  24. Sun Baked thread starter macrumors G5

    Sun Baked

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    #24
    Imagine the people's surprise when they talk with their accountant for taxes in a few months.

    They've hopped on board a lawsuit trying to recover as much money as they can ... they walk in and talk to their accountant.

    The fake profits ... poof, gone, only the actual dollars you put in are actual losses.

    You paid taxes for years on profits that weren't real, and can only redo a few years taxes. Feel sorry for the people in for 15-20 years that paid taxes on doubling/tripling their money.

    The lawsuit you just joined, postpones the actual losses you can write off until the case is settled ... and the SIPC is probably going to fight to say that only the brokerage was covered that the off-the-books company might not be.

    So the SIPC will take 2-3 years to pay out if they do (unlike FDIC, they have some strange ways to pay back), and your tax losses will keep getting postponed as long as the case you joined moves forward for 5-6 years.
     
  25. Desertrat macrumors newbie

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    #25
    63dot, you're wasting psychic energy with "Bush did..." stuff. There were those in the SEC who had been told of apparent irregularities, and I've read that some allegations had been made in the late 1990s.

    FWIW, it is rare that the investigatory/enforcement sections within any governmental bureaucracy change their behavior because of any change in administration. Career types just keep on keeping on. If there were political influence which helped Madoff, just take a look at those to whom he made large political contributions. Hint: They weren't Republicans. :)
     

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