Bernie Madoff’s ego is still huge.
He still laughs at the SEC’s stupidity for not catching on to his scheme, and he at once says that JPMorgan, UBS, and HSBC had to know something, while at the same time he brags that he hid his illegal activity so well that “it looked real.”
Bernie Madoff sat for an interview with the Financial Times recently and told the paper that the blame for his scheme lies also with the four men who were his first investors, and with the banks that watched billions go in and out and never said a thing.
Madoff has tried to spread the blame around before. This latest interview is interesting because he talks about the guilt he feels about the ego-driven, “embarrassing” Ponzi Scheme.
- “I spend a lot of time thinking about it – it is almost like a blank to me now. I try to piece it together; why didn’t I say, ‘I cannot do it?’ Why didn’t I return the money to those four or five clients – and the others – and say, ‘I can’t do it.’ Why?”
- “[It was my] ego. Put yourself in my place. Your whole career you are outside the ‘club’ but then suddenly you have all the big banks – Deutsche Bank, Credit Suisse – all their chairmen, knocking on your door and asking, ‘Can you do this for me?'”
- “I was embarrassed. It was the first time in my life that something hadn’t worked. I was just dumb. Dumb! Starting in the early 1990s there were no trades. It was just paper. But let me tell you… It looked real.”
- “I was scared to death,” he says. “I took no satisfaction in this. There was no malicious action on my part.”
He loses our sympathy when he brags to the FT, remembering how he he laughed to himself about the stupidity of the SEC.
“I had a contact with the SEC, who were concerned that I was front-running… I started laughing to myself – I knew I wasn’t because I wasn’t doing the trades.”
And somehow, he remembers himself as one of the greatest money managers in modern history.
“I said at the very beginning when I met with the SEC and Picard that my hope is that everyone will receive their principal [which amounts to $20bn]. Back then, everyone laughed. But [Picard] has already recovered $10bn and he will cover $20bn easily. If he is successful, he may get $50bn. That means that there will be $30bn profits to go around, which would make me one of the greatest money managers in modern history.”
And then of course there’s the shared blame he wants us all to believe. Three of the men Madoff blames for being complicit in his scheme are dead.
They also deny his accusations, according to the Financial Times.
- Picower is dead, and his estate settled for $7.2bn; his lawyers maintain he was not aware of the fraud.
- Levy is dead and his family settled for $220m.
- Chais is dead; his family denies any wrongdoing and has not settled.
- Shapiro, the only one still alive, settled for $625 million. His lawyer says, “Mr Madoff is a liar. These latest statements are no more believable than all the other lies that Madoff told his investors and the authorities for decades.”
There’s lots more great stuff in the FT interview. Read the full interview in the Financial Times >