1/24/09

Independent: Ironically Madoff Victim Stephen Greenspan Wrote a Book called "Annals of Gullibility: Why We Get Duped and How To Avoid It"

We particularly appreciate the irony that David Randall uncovered about the Madoff victim who wrote the book, Annals of Gullibility: Why We Get Duped and How To Avoid It...
The master fraudster and his $50bn 'A-list' of victims

Bernard Madoff milked investors ranging from banks to celebrities to some of the world's richest people. As lawsuits fly and probes gather pace, David Randall asks how he got away with the scam for so long

The worldwide economy may be teetering on the brink of a depression, but Bernard Madoff's one-man financial- chaos industry goes from strength to strength. In the past week or so alone, the old saboteur of Wall Street has seen the fallout from his fraudulent enterprise spawn lawsuits on several continents; official investigations in the UK, Spain, Switzerland and Ireland, as well as the US; subpoenas; and the claim that, of the alleged $50bn (£35bn) he milked from investors, a mere $1.2bn now remains. It may even be far less than that.

Most startling of all is a suggestion from one US regulator about Madoff's share-dealing scam, in which he paid out returns to old investors with deposits from new ones. The Financial Industry Regulatory Authority has discovered he did no share dealing through his own firm's brokerage arm. This leaves only two possibilities: that he did so through outside firms (highly unusual, and for which there is no evidence), or that he did no trading whatsoever, meaning that his company's books were not so much cooked as rustled up out of his head.

The warped mastermind behind all this – capable of looking charities straight in the eye while taking their cash and frittering it; capable, too, of taking $14m off one investor just five days before his arrest – is now confined to his $7m Upper East Side home. The only airing he gets is for court appearances, and on Wednesday he caused quite a stir by arriving at a Manhattan federal courthouse sporting a flak jacket. Some may have thought this excessive, since his wealthy clients' traditional weapon of choice has been nothing more lethal than social ostracism. But perhaps they were unaware of two of the week's other revelations: that among those defrauded by him are a Russian billionaire – who tried to get his cash out just weeks before the collapse, but was refused – and a gentleman representing a Colombian drugs cartel.

The list of known losers is lengthening by the day. They include Madoff's own sister, Sondra Wiener, a 74-year-old who is reported to have lost around $3m, and now "has nothing". She and her husband are trying to sell their home in a gated Palm Beach enclave. Another who has lost a large part of his retirement funds is Stephen Greenspan, professor of psychiatry at the University of Colorado. He is, in one of the choicer ironies of this saga, the author of a book called Annals of Gullibility: Why We Get Duped and How To Avoid It... more

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