There are con man, and there are CON master. I've always thought that if I were to be a con man, I should do it big time. Like really BIG time.
Why do it small time? Firstly, it's harder to con. Secondly, if your'e caught your losses still far outweights your rewards. Take our hero for the week for example. The con is worth USD 50bn!!!!! Who knows how much more he kept? The penalty apparently is 20 years jail or 5m fine.
I can almost hear it in court, "The defendant pleads guilty. Here's 10m, keep the change."
But the question I have in mind is how did he get past all the 'checks'. Did the governing authority practiced double standards in doing their job:- if you're a who's who they let you off easy, if you're a new player, they scrutinise you?
A friend have another good theory. The scheme he says, is 100% legit. Just highly leverage and exploiting some insider loopholes. When the financial crisis hit, the scheme starts to fall apart. So, Madoff, being the smaller fry is taking the fall. It's impossible for him to pull out such a scheme alone.
Now if the whole scheme falls apart, not only the insider loopholes will be compromised, the big fishes that Madoff works for will also be affected. Now, Madoff is already big, so you can imagine who the other bigger fishes are. Big money are also at stake .
Saying that it's a Ponzi scheme is easy and less 'technical'. Pleads guilty quickly. Investigation stops. Names are protected, loopholes are still intact. More money exchange hands. In about 2 years, the whole thing can start again when the financial crises is over. Afterall, humans do have a very short term memory.
