This week (December 7-13) in crime history – Colin Ferguson
killed six and wounded 19 on a Long Island commuter train (December 7, 1993);
First execution by lethal injection in Texas (December 7, 1982); John Lennon
was murdered (December 8, 1980); Frank Sinatra Jr., was kidnapped in Lake Tahoe
(December 10, 1963); Bernie Madoff was arrested (December 11, 2008); Singer Sam
Cooke was shot to death (December 11, 1964); Leona Helmsely was sentenced for
tax evasion (December 12, 1989); Texas Seven prison break (December 13, 2000)
Highlighted Crime Story
of the Week -
On December 11, 2008, Bernard Madoff was arrested at his
New York City apartment and charged with masterminding a long-running Ponzi
scheme later estimated to involve around $65 billion, making it one of the
biggest investment frauds in Wall Street history.
Madoff, who was born in Queens, New York, in 1938,
founded a small trading firm bearing his name in 1960. The business was
established, in part, with money he earned working as a lifeguard. Two decades
later, Madoff’s firm, which helped revolutionize the way stocks are traded, had
grown into one of the largest independent trading operations in the securities
industry, and he and his family lived a life of luxury, owning multiple homes,
boats and expensive artwork and jewelry.
Based on the success of his legitimate operations, Madoff
launched an investment-advisory business as part of his firm, and it was this
business that by the 1990s had become a Ponzi scheme, in which he paid his
earlier investors with funds received from more recent investors. For years,
clients of this business were sent account statements showing consistently high
and fraudulent returns. Potential new customers clamored for Madoff to invest
their money. However, in 2008, with the U.S. economy in crisis, Madoff’s
financial swindle began to fall apart as his clients took money out faster than
he could bring in fresh cash.
On December 10, 2008, Madoff revealed to his brother and
two sons, who worked for the legitimate arm of his firm, that his
investment-advisory business was a fraud and nearly bankrupt. Madoff’s sons
turned in their father to federal authorities, who arrested him the next day.
Madoff was freed on $10 million bail, and placed under 24-hour house arrest at
his penthouse on Manhattan’s Upper East Side.
The fallout from Madoff’s scam was widespread: The
victims included everyone from his wealthy country-club acquaintances,
Hollywood celebrities, banks and hedge funds to universities, charities and
ordinary individual investors, some of whom lost their life savings. The charitable
foundation of Holocaust survivor and Nobel Peace Prize winner Elie Wiesel lost
more than $15 million, and Wiesel also lost his personal savings. Public
outrage was further stoked when it was revealed that since the late 1990s a
private financial fraud investigator, Harry Markopolos, had repeatedly warned
the Securities and Exchange Commission about his suspicion that Madoff was
operating a massive investment scam.
On March 12, 2009, Madoff pleaded guilty to the 11 felony
counts against him, including securities fraud, money laundering and perjury.
On June 29 of that year, a federal district court judge in Manhattan sentenced
Madoff to 150 years behind bars, calling his actions “extraordinary evil.”
On December 11, 2010, the second anniversary of Madoff’s
arrest, his 46-year-old son Mark was found dead in his Manhattan apartment
after committing suicide. Bernard Madoff, who is serving his sentence at the
Butner Federal Correctional Complex in North Carolina, has maintained that his
family members knew nothing about his crimes and although they have faced
intense scrutiny, none have been charged with any wrongdoing. Several of
Madoff’s former employees, including his accountant and chief financial
officer, have pleaded guilty in connection with the long-running fraud.
Check back every
Monday for a new installment of “This Week in Crime History.”
Michael Thomas Barry is a columnist for www.crimemagazine.com and is the author
of seven nonfiction books that include the soon to be released In the Company of Evil Thirty Years of
California Crime, 1950-1980 and the award winning Murder and Mayhem 52 Crimes that Shocked Early California, 1849-1949.
Visit Michael’s website www.michaelthomasbarry.com
for more information. His books can be purchased from Amazon through the
following links:
http://www.amazon.com/Company-Thirty-Years-California-1950-1980/dp/076435003X/ref=sr_1_2?ie=UTF8&qid=1449509523&sr=8-2&keywords=michael+thomas+barry
http://www.amazon.com/Murder-Mayhem-Shocked-California-1849-1949/dp/0764339680/ref=sr_1_1?ie=UTF8&qid=1449509523&sr=8-1&keywords=michael+thomas+barry
