Madoff Questions

Q1: A Ponzi Scheme works if and only if the schemer acts as if they are trustworthy and reliable. Once the con man has a person trusting him, he will persuade them to invest in him. After this, the schemer can use his investor's money to keep his con going.

Q2: The reason why Bernie Madoff was able to keep his scheme going on so long was mostly due to the fact that he was paying his old investors with the money from his new investors. This allowed for no one to expect anything was wrong, therefore the scheme was able to progress.

Q3: A Ponzi Schemer is usually the type of person that you would tell a secret to, he/she seems to be a very trustworthy person and will most likely persuade you to invest in him. A con man could also be described as being very charming (even if you just met the person, you would feel like you've known them your whole life), this contributes to the reason why you end up trusting the Con man and investing.

Q4: Although the SEC was alerted of the Ponzi scheme going on, no body did anything about it. This is most likely due to the fact that Bernie Madoff was a part of the SEC and he knew people on the board, therefore there was no investigation on the scheme.

Q5: I believe that Madoff committed the scheme because he knew that he would be able to get away with it. With his charming and trustworthy personality, and his place in the SEC, I think that Bernie knew that he wouldn't be caught. Although he eventually did get caught, the only reason was the 2008 housing crisis, so if it wasn't for that Madoff probably could have kept the con going for longer.

The SEC investigated Bernie Madoff's Ponzi scheme 8 times leading up to his arrest, this could be one of the reasons why the scheme went on for so long without being found out about.

Although the 65 million dollars invested in Madoff disappeared when he was caught, various organizations are trying to recover the money in order to give it back to everyone who lost their original money.

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