Madoff Defrauds Investors of $64.8 Billion Disgraced financier Bernard Madoff is

Question

Madoff Defrauds Investors of $64.8 Billion Disgraced financier Bernard Madoff is in jail after pleading Social Engineering guilty in 2009 to the biggest fraud in Wall Street history. For Fundamentally, Madoff relied on social engineering and four decades, Madoff perpetrated a complex and sinister the predictability of human nature to generate income for raud. Prior to his arrest, Madoff was viewed as a charis- himself-and not on financial expertise. Madoff would ask matic man and stellar financier with favorable connections people to invest in his funds, which were by invitation only brokers on Wall Street and in Washington. Since to create the illusion of exclusivity. Madoff used this tactic to to power his arrest, federal prosecutors have maintained that Bernard create the illusion that only the elite could invest because of Madoff ran a scheme that bilked wealthy individuals and consistent returns and his stellar Wall Street reputation. As arge nonprofits out of an estimated $64.8 billion.

Explanation / Answer

1)Trust was very important because people ignored the warnings as they

trusted Madoff, especially the feeder funds.

2)Madoff used an elusion of exclusivity to lure wealthy investors , who thought exclusivity

meant a sure thing.Madoff also used his reputation in Wall Street.

3)A red flag is a warning sign of something wrong.

4)Red flags were ignored because of reports of steady returns gave investors a false sense

of security . Also being a Wall Street fixture , he was trusted and his work was not given full scrutiny.

5)A fraud can always happen again but the chances of it happening again can be reduced by hiring more officials to crack down on fraud.

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