After Madoff, America’s own Ponzi fraud unwinds

Call any Jewish friend these past few days and the degrees of separation from someone financially devastated by Bernie Madoff's $50bn heist are often only one or two. It's not just ruined heiresses in the Palm Beach Country Club now faced with the prospect of dividing the Jellymeat Whiskas can into two equal portions for mistress and cat, it's Jewish academics on Ivy League campuses, Jewish doctors in Santa Monica finding their retirement nest eggs or charitable trusts wiped out overnight.

I called up one rich Jewish pal in New York and asked whether I should Fedex him some dry rations. He volunteered cheerfully that because of some intricate family dispute his own money hadn't been parked at Bernard L. Madoff Investment Securities LLC. On the other hand his uncle had woken up the morning after Madoff's arrest to discover that the $40m he'd entrusted to Bernie was gone forever, along with the multi-million pension fund of his workforce, which he'd also entrusted to Madoff.

His fraud ranks as a major ethnic cleansing in 21st-century America

Of course Madoff had clients of every creed and nation, but he made a speciality of trolling for Jewish money. His fraud ranks as a major ethnic cleansing in 21st-century America.

How did Madoff, despite widespread suspicions across many years, continue to allure so many investors, smart fellows like Steven Spielberg, well equipped with expert number crunchers?

The most gullible dupes of all are those who preen themselves as being privileged accomplices in a profitable conspiracy, at scant risk to themselves. Many of Madoff's clients were not so naive as to believe he had a virtuous investment model that permitted him to report 10–12 per cent annual returns on capital invested, through boom and bust. They thought Bernie's 'model' took the distinctly unvirtuous form of insider information. Thus did Madoff's prosperous victims fatally miscalculate the dimension of the swindle.