The Ordinary Evil Of Bernard Madoff

Opinion By Gilbert Mercier, NEWS JUNKIE POST

Yesterday, Bernard Madoff was sentenced in New-York to 150 years behind bars, if nothing else his victims can be reassured that he will finish his life in jail.

When Madoff’s victims describe him they often have used such words as likable unassuming and a man they could trust. Many of them said that “he was just like one of us,” they thought Madoff was a “mensch.” Like a lot of criminals in other communities, such as African-Americans & Latino, Madoff was praying on the Jewish community including Jewish charitable organizations.

Madoff stole from them, the SEC had been warned of the potential frauds for many years and on numerous occasions but failed to do anything about it. Madoff’s victims feel that the entire system let them down.

What Madoff’s case illustrates is the crisis of trust that we are having in our financial institutions in general, and in Wall Street in particular. Bernard Madoff is not the exception confirming the rule of Wall Street’s culture. In fact, it is quite the opposite, he was one of Wall Street’s arrogant poster child, a full member of the self described “Masters of the Universe” of the financial world. Madoff’s victims though they were lucky to have their life savings in the hands of such a reputable man, and after all he could get them better returns than anyone else.

In essence, at least from a moral and ethical stand point there is only a small difference between Madoff’s swindle and the management decisions from the bosses of AIG, Countrywide and Bank of America. The principle is exactly the same, it is about deception and greed. Without the collapse of late 2008, Bernard Madoff could have kept his Ponzi scheme going for some time. It only collapsed because too many people tried to cash out at the same time, just like AIG when world wide banking institutions decided it was time to look into getting some real financial guarantees on all the exotic derivatives they were holding.

Once the “exotic derivatives” were identified as being nothing more than over estimated bundled assets, they became known as toxic assets, a much more appropriate name. Madoff was certainly a part in the arsenal of what Warren Buffett described as “Financial Weapons of Mass Destruction,” but he is not the only proverbial “rotten apple.” Madoff is a symptom of a much larger problem.

Bernard Madoff is the symbol of our current moral crisis. The trust in the system is gone, a lot of investors were under the impression that the “Masters of the Universe” could do no wrong. In fact a large proportion of the so called financial elite were not only dishonest, but had no foresight of the gigantic looming problems. Americans are starting to realize that the “smartest guys in the room” were not that bright after all. So far the Obama administration has not done enough to change Wall Street’s culture .

“Greed is good” would not be something politically correct to say at this juncture, but you can rest assured that somewhere in the financial world some Bernard Madoffs- in-the-making are working on some new scams.

Madoff’s victims have a website, you can watch three touching testimonies here.