Bernie Madoff: the story of Wall Street's biggest con man

Two figures marked Bernard Madoff's life and death: 150, the number of years he as sentenced in prison as the biggest con man of Wall Street history; and 64, the billions of dollars he stole from investors in the course of two decades.

After more than 10 years in prison and nearing his 83rd birthday, Bernard Madoff has died in a federal prison cell in Butner, North Carolina, in April 2021.

But not only Bernard Madoff himself died in disgrace. Several family members would pass away after the scandal broke in 2008. Most recently, in February 2022, his sister and brother-in-law were found dead in their home, NPR reports. For Madoff's family, the story seems far from over.

When Madoff passed away, he held the dubious honour of being the greatest schemer in history. His Ponzi scheme exposed many of Wall Street's shortcomings and marked the end of a golden age when money seemed to flow in only one direction: green numbers.

Given the shameful crime he committed, and while knowing the delicate state of his health (a terminal illness), authorities never granted him clemency, leaving him to die in prison. "Releasing him would minimise the seriousness of his offence," they claimed.

His lawyer, Brandon Samples, applied for clemency to the Southern District of New York on 5 February 2020. "After more than 10 years behind bars and with less than 18 months to live, Bernard Madoff humbly asks this court for a modicum of compassion," he said. But there was no compassion, just as Madoff had no compassion for his victims.

Madoff had 150 years in prison against him. Among the charges were stock fraud, fraudulent investment advice, mail and wire fraud, money laundering, false testimony, perjury, social security fraud, and theft from an employee benefit plan.

In addition to the historic sentence, a forfeiture of $17 billion was ordered, of which a trust chosen by the New York court was able to recover $13 billion.

(Pictured: belongings of Bernie Madoff that were auctioned off as part of the federal Asset Forfeiture Program)

That amount was far from the entire number stolen, though. While Madoff himself talked about a loot of $65 billion, the authorities believe he swindled approximately 20 billion dollars. No number of golf clubs and Madoff jackets could make up for that.

The scam was as simple as promising tremendous, consistent and rapid returns to investors. When investors made claims, Madoff tried to delay his response as long as possible.

After a while, he would hand the complainants money that he had received from other, new investors. As such, there were people who made money, but the majority, the base of the pyramid scheme, lost millions and millions.

At one point, Bernie Madoff paid out profits in excess of 8% per annum for 72 months (6 years) in a row.

Obviously, investors were unaware that these profits could very well come out of their own invested money.

The impact of Bernie Madoff's collapse was considerate, but he was not the cause of the 2008 recession. Still, the scheme and the crisis were related to each other.

In 2008, the bubble of subprime mortgages burst. Lehman Brothers went bankrupt, which set off a domino effect that triggered the Great Recession, the first global economic crisis of the 21st century. Amidst the downfall of many companies who had offered insecure financial deals, Bernie Madoff got caught.

The collapse of Bernie Madoff's pyramid scheme was a blow to many investors, but certainly not the first or last blow to the financial sector.

Madoff's arrest not only brought down his empire, it tore his family apart. Mark Madoff, his eldest son, took his own life in December 2010, on the very day that Ruth Madoff (pictured), Bernie Madoff's wife, stopped going to see him in prison.

While his youngest son Andrew Madoff died in 2014 of cancer, his daughters-in-law and grandchildren went so far as to change their surnames in order to avoid being associated with the biggest swindler in Wall Street history.

(Photo: Bernie Madoff's shoes on auction)

Almost a year after Madoff's death, in February 2022, his sister and her husband were found together in their apartment. Both had gunshot wounds, NPR reports, and it soon became clear that they had taken their own lives.

After defrauding thousands of people, Bernie Madoff's scheme created a trail of misery in his own family. Was it worth making the billions in exchange for the lives and legacy of your entire family, and the utter disregard for a name that will forever be branded in the black history of Wall Street? That is something Bernie Madoff can never be asked to answer for again.