Interesting article i came across..
The recent case of Bernie Madoff, former chairman of NASDAQ,
accused of running the biggest Ponzi scheme in history, has no
doubt, sent tremors throughout the financial markets. The sheer
enormity of the scam, to the tune of USD$50 billion, is
mind-boggling.
How did wealthy, sophisticated, individuals, professionals in their
own right, and occupying prominent positions in the highest
echelons of society succumb to such duplicity?
The single, overriding factor that made Madoff's investment
vehicles attractive was the metronomic uniformity in their
performance. One of his funds, Fairfield Sentry Ltd., reported
annual returns of between 8 percent and 18 percent every single
year. Now we know it was all a facade. The US government says
Madoff was paying off early investors with the funds incoming from
later investors.
