For most Americans, the drumbeat of bad financial news that began in spring 2008 and rose to a crescendo a month before the fall election was largely incomprehensible—a catastrophe conducted in Etruscan or some other unknown language. And then, out of the welter of institutional names and the oceans of numbers emerged an easy to remember villain, an individual who symbolized dirty hands on the levers of corruption. His name was Bernard Madoff. The History Channel documentary, “Madoff and the Scamming of America,” is out now on DVD.
The direct impact of Madoff’s crimes on everyday people was slight. Like a good Hollywood movie or a celebrity scandal unfolding in the tabloids, Madoff’s deeds took place in a rarefied realm. His Ponzi scheme at first involved his friends, then their fiends; eventually he victimized well-endowed philanthropies and extended his grasp into the worldwide web of hedge funds. To be ripped off by Bernie was to belong to one of the world’s most exclusive clubs. Madoff sometimes turned down investors with a smile of regret.
Whether he began as an honest broker and gradually went wrong, or was a crook from the get-go, is a question unanswered by the documentary. But by the end of his long run at the top, Madoff apparently invested every penny he was entrusted with in his own bank account.
“The Scamming of America” explains how Madoff was able to dupe an affluent, often sophisticated set of victims. His charm aided him. Over time Madoff became the consummate insider, an innovator of computerized stock trading, chairman of NASDAQ and a sought-after speaker. He was important. And his scam was cultivated to appear almost reasonable. Investors were guaranteed 10-12 percent annual growth and plied with impressive looking paperwork. Madoff played like a maestro on the paradox of security in speculation, gambling on Wall Street as the surest road to wealth. To most eyes, Bernard Madoff Investments appeared sober as Washington’s face on the dollar bill.
A few whistle blowers added up the numbers and found them wanting, but federal regulators turned a deaf ear. Madoff was trusted in high circles, whose supposed deep thinkers shared the public’s childlike belief in an unrestricted market and the notion that we were living through a boom time without end.