In an era of faceless organizations owned by other equally faceless organizations, Bernard L. Madoff Investment Securities LLC harks back to an earlier era in the financial world: The owner’s name is on the door. Clients know that Bernard Madoff has a personal interest in maintaining the unblemished record of value, fair-dealing, and high ethical standards that has always been the firm’s hallmark. — From the Madoff Securities LLC Website
We keep trying to imagine what Bernard Madoff’s sons, Andrew and Mark Madoff, were thinking when their father, a prominent and respected Wall Street trader and a former chairman of the NASDAQ Stock Market, sat them down in his Upper East Side apartment on Wednesday and told them that the investment arm of Madoff Securities, the firm he founded in 1960, was “basically a big Ponzi scheme,” that he had “absolutely nothing” left, that his investment business was, as the SEC would later put it, “a stunning fraud” “of epic proportions.” These are guys who spent their entire careers since college — twenty years — in the family business. Who grew up with a father who kept a yacht docked in the Bahamas and a spread in Montauk. Did they know? Did they suspect anything? How long did they think about it before calling their lawyer Wednesday night and turning their 70-year-old dad in?
After all, as Mark Madoff told Wall Street + Technology back in 2000:
“All of his family members grew up with this being our lives. When it is a family operated business you don’t go home at night and shut everything off. So you take things home with you, which is how all of us grew up.”
Madoff lost a suspected $50 billion, two hedge funds have already buckled due to investments made with him, and a day after his arrest, he’s already being mentioned in the same breath alongside Boesky, WorldCom, and Tyco. So it seems they belong to a different family now.
Top Broker Accused of Fraud [WSJ]
Madoff ‘Big Lie’ Hits Fairfield Sentry, Kingate Funds [Bloomberg]
Bernard L. Madoff Investment Securities [Official site]