Maybe I'm callous, but I really don't feel a lot of sympathy for Madoff's victims

[Recursion]

The sob stories I'm hearing, while certainly sad, are of people who had a lot of money, trusted one person to handle it, and now have to live lives like the rest of us. I don't know, maybe I should feel more sympathy towards them, but I just don't.

[Starbucks Anarchist]

1. Elie Wiesel's foundation collapsed because of Madoff.

[Telly Savalas]

66. Then the person in charge of the funding for that foundation was an irresponsible asshole.

The most basic principle of money management is to not put all your eggs in one basket.

And when that one basket is a black box, it's mind-blowing that anyone would invest all their money in it.

[closeupready]

2. Yes, you should be able to empathize, and I don't know why you can't.

His victims may have been wealthy, but regardless, the stress of losing your home (as happened to some) at the age of 72 or whatever must be almost impossible to bear.

[Recursion]

16. OK, but rule 1 I learned when I took personal finance...

...was to assume something like this could happen and not put all your eggs in one basket.

Especially the foundations and pensions; they're supposed to have diversity and hedges to mitigate one investment vehicle's failure. Why didn't they?

[closeupready]

17. Good point, but I have no idea.

On the other hand, it's unclear to me what percentage of the foundations and pensions were wiped out entirely. I think that applies only to a handful.

[Happyhippychick]

21. You are working on the flawed assumption that people KNEW that all of their eggs were in one basket.

Many people did not know that, their brokers put all of their assets with Madoff.

[JuniperLea]

63. I demand due dilligence

Even from brokers.

[stray cat]

36. the same goes for all who lost their retirement or any that rely on SS or medicare

when it could be eliminated. Glad you are brilliant and avoided any loss - hope you can keep it up until you save millions so you can retire by just putting the money under a matrress.

[Hannah Bell]

45. no it doesn't. folks "relying" on ss only have one egg. the folks "investing"

with bernie had millions of eggs.

they gave them all to bernie cause they liked the 20-30-50% returns.

[DeschutesRiver]

37. Bernie stole from working class people too; and good point re diversification

Nobody should be sticking the all the money you save instead of spend under a mattress either. You spread it around so that if fraud is occuring behind the scenes, or a company goes under, or the markets tank and everything takes a hit, you don't lose every dime you've saved to some outside event beyond your control.

I do feel sorry for some of Bernie's victims. He didn't offer returns that were "too good to be true", and kept just enough mystery and exclusiveness going that people probably thought the reason it was so hard to place money with him was because his modest but steady earnings were the real deal. I was surprised at the percentage of folks who'd gone with Bernie's fund that had ordinary jobs and lives, that saved like demons (and over many decades had denied themselves everything that others have bought on credit and defaulted on), and put all away so they wouldn't be a burden on anyone as they grew old and waited to die. I know there are people who didn't realize their investments were with Bernie (like those working class guys in upstate NY whose pension invested with Bernie - can't remember, but think it was carpenters), which is a whole 'nuther layer of this scam, but I am not certain of the percentage on that either.

But those are just percentages that would be interesting to know. The lesson is that any of these individual victims that did diversify likely still have some retirement left upon which to live. It is Bernies fault entirely that he was a nasty piece of goods and a con. It is the investors own decision to risk everything they own betting on investing with just one man. And given that you can't influence your pension holder's decisions on these matters, might not be a bad idea to make sure you have other money saved away besides that - again, diversify.

Nobody cares about your money, your family or your future like you do - they simply don't give a shit about how it all ends for you and yours. No guarantees, but I trust myself on those issues more than others, and because I can't figure out every scheme out there or bad event on the horizon, I split up all my bets just in case, in all areas.

[northernlights]

54. because their investments weren't directly to Madoff

they were through investment firms that *lied* to them.

I remember seeing one big-league investor on McGloughlin group (can't for life of me remember his name, but he's a regular there) who was burned by Madoff. He said he did all the due diligence he possibly could short of getting a subpoena to look into the files of the investment firm. It was a big-name firm that was supposed to be diversified. But the reality was that the investment firm lied to its individual investors and threw all their money into Madoff. So all those individual investors, including pension funds, did what they were supposed to do but got burned anyway.

[tridim]

3. But BushCo's SEC assured them it was a safe investment

I feel sorry for anyone who has money stolen from them, no matter the amount.

[Happyhippychick]

4. You haven't heard all of the stories from the thousands he swindled.

[Recursion]

13. That's definitely true

What I've heard is socialites and heiresses complaining that they have to work now.

I guess having millions of dollars to lose is so far from anything I've ever experienced that I have trouble feeling that bad for them. They're now where most people in this country are, and most of them had some pretty fat years before this.

One thing I wonder about is what happens to the money that got paid out to people who got out before it crashed? Do they keep it?

[Renew Deal]

5. People like Eli Weisel's charity and university money and seniors who went broke

People that didn't know their money was invested with Madoff.

Not only are you callous, you're clueless.

[Vinnie From Indy]

15. Clueless & Callous describes the OP Perfectly!

I wish I had the last twenty sedconds of my life back after reading the OP's silly musings.

[tuckessee]

27. Clueless & Greedy describes most of the victims.

I think WC Fields addressed this issue...... "You can't cheat an honest man...."

[yawnmaster]

41. link? I'd be interested in the statistics.

[high density]

30. The people that "didn't know" were a very small subset of the victims, at least in dollar terms

Most of the investors sought out Madoff. It was a rather exclusive club until he desperately needed money in the last few years of the scam. At that point certain companies wrapped investments in Madoff's fund, and I feel these people should be prosecuted as well for failing to do their fiduciary duties. As should the people in charities or endowments that decided to blindly give money to Madoff.

I'm just trying to imagine if my 401k plan had a fund named "Unknown black box investment. Historical returns: 10% per year." How sympathetic would people be with me if I had dumped all of my money into that investment option and lost everything? I'm sorry that people couldn't see the light before this happened, but it seems the vast majority of these "victims" were trying to live in a world that didn't exist while the rest of us played by the rules.

[hugo_from_TN]

43. Clueless is anyone who doesn't know where their money is invested.

[atreides1]

6. Not All the Victims were in that category

Many non-profit groups that did things for others were also victims.

[napi21]

7. The ones I feel the most sympathy for are the people who lost

pension funds, and the many charities where at lest the members of those groups didn't CHOOSE who to invest with, but their savings are still GONE!

[CBGLuthier]

8. remove maybe

You leave little doubt.

You include all the retirees in that callous list?

[ejpoeta]

9. they weren't all rich people. there were a lot of charities and regular folks too

who put their retirement money in. people who trusted that a guy who had been in the business for a long time would not screw them over. and they also had friends tell them this guy was safe deal. I feel bad for them.

[Rabrrrrrr]

10. As a human being, I feel a lot of empathy for them and anyone who is screwed over by shysters.

But, clearly, your mileage varies.

[Lost-in-FL]

11. That is precisely why it should matter.

because if they were poor people to begin with, no one would have paid attention to their plight.

[SoCalDem]

12. Making more money than is "ordinary" is something most people cannot resist

Barney knew that.

It "worked' as long as there were "paper millionaires" who kept shoveling "new money" in, but when tight money arrived, they held back and it collapsed.. New money eventually runs out, and that's when the scheme falls apart..

When most other investments were paying 4-7% and his promised and delivered (on paper) 12-15%, people were eager to let him manage their money.,.and don;t forget, the SEC gave him a clean bill of health..

[sandnsea]

14. We had a similar scam in my town

people with millions instead of billions. I know these people. They're all greedy fucks, every one of them. They wouldn't cross the street to give someone a drink of water. I don't feel bad for them either. There are a few who get sucked in, maybe against their better judgment or naivete. But most of them are just greedy. Some of these people, locally, are right back in it with other slimy investment schemes. They don't learn.

[Recursion]

18. I think it's the same thing that bugs me about people who "lost money" in their houses

I know people who bought a house for, say, $200,000 and now it would sell for $150,000. That sucks to lose $50,000, but the way they see it, since their house was at the peak (over)valued at $350,000 they are convinced they lost $200,000.

If you gave Madoff a million dollars and didn't get out in time, you lost a million dollars. But you thought you had 5 million dollars (which you didn't), and feel like you lost 5 million.

[Statistical]

19. Would you not have sympathy for a rape victim that didn't take precautions to avoid attack?

victim is victim
criminal is criminal

Lots of charities, and charitable trusts got busted from this.
Lots of retirees lost everything. Not all of them were billionaires.

Many invested w/ Madoff and were happy to get in and have their small funds managed by someone who was trusted by Wall Street Titans.
You can accept the people were reckless and/or naive AND STILL feel sympathy.

[arcadian]

25. bullshit

How many of these people would have absiolutely no problem if Madoff did return on their investment but say the investment was in blood diamonds? They would have not one problem with that, just as long as their money doubled or tripled.

[lame54]

20. That was Madoff's real crime - it's not that he stole...

it's that he stole from them

those who steal from us don't get arrested - they get community plaques

[high density]

22. I don't feel much sympathy for them either

People act oddly when it comes to large sums of money. They might nickel and dime in their daily lives by catching that pricing error at Wal-Mart for $.30 and then standing in line for 15 minutes to get it fixed. Then when it comes to millions of dollars of their portfolio, they are happy with putting it in a black box (Madoff) or handing control over it to some sort of "financial adviser" (e.g. an Edward Jones agent) who is nothing more than a salesman. People need to spend some time and understand investing for themselves. It really isn't that hard to figure out asset allocation. Investors were willfully ignorant over Madoff as long as he kept the "returns" coming.

[Xenotime]

23. This is what happens when you let the wealthy manage the money.

We need laws and regulation to control this.

[laureloak]

24. Yes, you are being callous. n/t

[BlooInBloo]

26. It's funny, watching crabs pull each other back into the crab trap.

[tuckessee]

28. Back in '36 WC Fields addressed the issue of the Madoff "victims"

He said "You can't cheat an honest man...."

[leftynyc]

40. So, according to you

Elie Weisel deserved for his foundations to lose all its money. Yes, you are callous - and clueless.

[tuckessee]

65. Apparently I'm not as clueless as the Weisel foundation investing specialists.

For even I would've recognized that the returns that were coming in were not right or even realistically possible therefore I would've sought a more responsible, less shady place to park my money.

[LeftishBrit]

29. A lot of those that have lost out are organizations, not individuals

Charities, on which vulnerable people depend.

Other organizations that employ people; I know someone (American, obviously) who may be in danger of losing their job at an institution that lost a large amount of money.

Not everyone who is suffering was ever a rich person, and some of them may end up BADLY damaged.

[Recursion]

32. OK, then the CFOs of those organizations need to be fired

If you have a responsibility for other people's money, don't put it in a black box.

[LeftishBrit]

56. Very likely many CEOs and adminstrators and accountants DO deserve to be fired

But that neither excuses Madoff, nor reduces compassion for those seriously damaged. Many of whome were NOT rich.

[high density]

33. Ok...

Why couldn't this handful of charities put their money in real investments like everybody else does? Why did they put so much trust into one person? Why didn't they question the returns as nearly every asset class was hammered over the last couple of years? There seemed to be a prevailing opinion around Madoff's victims that what they didn't know didn't hurt them... until it did.

[Buzz Clik]

31. Yep, you called it. You are callous.

[stray cat]

34. Schools lost endowments so those wealthy college students who can't afford college

are not getting grants. People who work at universities are losing their jobs - but those instructors and secretaries and janitors are wealthy extremists who have money to burn.

[stray cat]

35. or those who lose jobs or those who go bankrupt due to lack of sufficient health care

after all they didn't have the foresight to avoid potential fall out from crooks or bad luck.

[cbdo2007]

38. I'm sure when you have/will be taken advantage of in your life...

there will be plenty of people out there that won't feel a lot of sympathy for you also.

I guess your only hope is that those people aren't on the jury when you're a plaintiff.

[JerseygirlCT]

39. Those people, and many foundations and other charities

And many people who didn't even realize they were invested with him - they had financial advisors who were using Madoff.

In any case, a lot of people who worked hard for their money, or who depended on the work of a charity, are now completely out of luck.

[dugaresa]

42. I do feel bad for them, but there are lessons to be learned from their suffering

and hopefully others will take notice.

1. If it sounds too good to be true, it probably is. (this bit of common sense is normally ignored when people want to make money.)
2. Putting all your eggs in one basket is a bad thing. (another common tidbit that is commonly ignored)
3. Be careful who you trust with your money and your loved ones, don't fall for the charm do some research.


Sadly these lessons have been around for a long time but all of us at one time ignore them either out of greed or perhaps because we really want the situation to be true. Who knows.

[spanone]

44. everyone who invests does not have 'a lot of money' false assumption

[Hannah Bell]

46. everyone who invested with bernie did. since there was a minimum buy-in,

something in the neighborhood of a million.

[mullard12ax7]

47. Plus, people do not want to know what they're investing in

They just want the cash and if it came from some illegal dealings, well who cares, as long as it can't be traced back to them.

[Odin2005]

48. You don't feel sympathy for Eli Weisel?

:crazy:

[Orangeone]

55. He's not a saint

He was very Pro-Iraq War...

[Recursion]

58. Over this?

First off, I seriously doubt Wiesel was the one deciding where the foundation's money went. But if he was, yeah, that was a dumb move on his part. I was a little disturbed when I heard an interview with him where he compares Madoff to the guys that kicked him out of his house when he was a kid (those guys, at least, were not Nazi's I think, so we narrowly avoided an Eli Wiesel-induced application of Godwin's law). But, hey, the guy just lost a shitload of money so I figure he's got room to be angry.

[earth mom]

49. Weren't Madoff's investors making a ton of interest every year to begin with?

I feel sorry for some of them, but others not so much. :shrug:

[Hannah Bell]

50. yes - the returns were so high & so consistent you'd have had to be blind

not to know something was wrong.

[charlie]

52. Rock steady

Low double-digits for almost 2 decades, rain or shine. Madoff delivered the impossible, which was obvious to investors smart enough to staty away.

[WI_DEM]

51. Yeah I'd say callous. I know there is a 93 year old man who lost his "fortune" and now working at a

supermarket to make ends meet.

[Fire1]

53. The worlds smallest violin.

:nopity:

[FarCenter]

57. Some of Madoff's investors thought that he was cheating, just not that he would cheat them

Bernie had a stock trading company and an investment company. At least some of those fortunate enough to be allowed to invest in the highly exclusive investment company thought that he was making the extraordinarily high returns for them by "front running" other investor's trades being executed in the stock trading company.

[Jakes Progress]

59. That's because you don't think well. nt

[bermudat]

60. Whatever happened to not putting all your eggs in one basket?

[Canuckistanian]

68. I always thought that was the cardinal rule of investing - diversity

All investing is a gamble. You don't blow everything on ONE person's judgement.

[MrBig]

61. The only way to feel no sympathy

is to generalize them under one umbrella and then criticize that generalization.

They were "all rich"
They were "all greedy"
They were "all callous"
They were "all bad people"
They "all knew something was up and didn't do anything about it."

None of these are true and some of them aren't reasons to feel no sympathy. You're telling me that the amount of money someone has should dictate their status as a victim? Call me a liberal, but I don't think so. People make mistakes and maybe some of them should have seen signs of problems, but the fact that they didn't is a terrible reason to withhold sympathy.

Rich or poor, these people were swindled and deserve sympathy.

[JuniperLea]

62. Does no one do due dilligence anymore?

From what I'm reading, there was a lot of "trust" but virtually no due dilligence. Stupid.

[question everything]

64. Many of them have never heard of him

They trusted a money managers which would be common for the ones who do not understand and do not want to deal with finances - and that money manager - "feeder" - put the money into Madoff.

Worse, they cannot get a break from the SEC that is available for victims of fraud, who directly invested with him.

[flvegan]

67. No, no "maybe" about it.

[lonestarnot]

69. Woopsie.

:evilgrin: