Bernie Madollar’s Ponzi-Scheme Explained

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In 2009, American financier Bernie Madoff pleaded guilty to eleven charges and was sentenced to 150 years in prison. Madoff had operated the largest and most high-profile Ponzi scheme in the world’Ss history. For decades, the scheme operated as Madoff made the investors believe that they were making high returns. Originally, Kalen Smith wrote this article that is parodied in this paper. Kalen successfully tells his readers the chronological events of how the scheme started, and how Madoff stole from Americans to the collapse of the scheme. In a rephrased form, this paper employs parody and humor to reveal the naivety of Americans involved in the scheme as investors.

In 12th March 2009, America’s greatest conman, Bernie Madollar admitted having stolen billions of dollars from Americans. He operated what can be regarded as the world’s largest money minting factory. He used his brains properly to ‘pick-pocket’ $65 billion from the Americans with a large appetite for money (Hurt 2). Most of them were the fat and pot bellied investors who dictate the path that American money follows and where it goes to. In fact, Madollar was a genius even when others brand him as the greatest thug ever. Some people feared that their tails would be cut if they dared expose Mr. Madollar and thus either salivated at his huge earnings or watched with contempt.
The sad fact is that Ponzi schemes are as prevalent as sins in the world. However, Madollar’s scam was a special one. Most of these money laundry schemes work bests in smaller scales among the poor. However, Madollar’s firm did not spare anyone in America. It slashed both the rich and the poor persons’ wallets and left them with nothing. It was big and he, Madollar can be seen as a wise person who properly used his brains to punish those Americans whose appetite for money cannot stop even with medication.
Ponzi-scheme can be regarded as complex and cannot be understood easily even with the sharpest brain around. The reason can be that it is meant to steal money from hard working citizens and must be kept as discrete as possible (Hurt 9). They are more advanced and ‘better’ (in the eyes of the conman) than pyramids schemes. In pyramids schemes, the people are like fish. They do not know that what appears to be food is bait on the hook which will trap them. The victims walk merrily and calculating loads of profit as they invest in the scheme. Ponzi scheme is an art, a super orchestrated work. It needs just one sharp brain to coordinate the fraud by fooling all the heads involved. To keep taking money from investors’ pockets, the great brain behind this project ‘persuades’ several preys that they are putting their cash in a legitimate and licensed fund. He convinces them that they will earn huge returns and they naively accept the gospel of orchestrated lies (Hurt 12). After that, the trickster uses the money from the newly recruited or ‘upcoming investors’ to feed the existing investors. However, for this illegal act to make benefits, the perpetrators require more victims to steal from. The more the supply of victims, the more the money the fraud makes.
As time passes, the pot that contains the money of the newcomers goes dry. In most cases, the problem begins when people are not aware due to economic factors. When the project begins running low on the victims, the legs become weak, and it starts to fall. The once happy investors lose all that they had invested. As expected, the brain behind the fraud will take to his heels. He or she might hit the run way in the next flight to a destination that only he or she knows (Smith 215). When caught, the fraudster is inflicted in ideally an impossible situation of compensating the investors. Unfortunately, the biggest casualty is always the government that has to clean up the mess in a paying restitution. However, most victims will still be wailing due to the trouble of recovering all that they foolishly gave away because of greed.
Madollar the Smart Fraudster
Madollar strategically established his portfolios, and they gave that look of a descent business. It enabled him to pay the existing investors a less amount. This was the first step to his hallmark. He could still access new victims and fool them as well. He built an empire. He made it safe for work by ensuring that his firm was off from the nosey and nagging government. Madollar was wise because he chose his targets carefully. He aimed at a specific crop of investors. He brought them closer to him to eat from them. He also worked closely with Security Exchange Commission and crippled it. SEC became a huge and masculine bull dog that was toothless and could not bite Mr. Madollar. Every financial dealing demand recorded accounting. That is what they teach in business school (Smith 215). Madollar defied all the paperwork yet he made so much money while those genuine investors who followed the rules never had positive returns. Madollar should have won a Nobel Peace Prize Award because he kept his scheme operating for years yet no Ponzi scheme could last that long.
Madollar ensured that his victims remained as naïve as possible by eliminating any shred of suspicion. He made them believe that they had the power to withdraw their invested money anytime they wished to. Madollar made them drink his liquor, and they all got tipsy to the level he wanted. It is not always advisable to try and replicate somebody else’s luck because you will fail. Other investors tried the same; only that they were legitimate, and they failed. One firm posited to the SEC that his company was not earning like Madollar’s securities. Madollar was in his own league and was unstoppable.
The Crumbling of an Empire
After more than ten years of fooling the investors and SEC, Mr. Bernie Madollar witnessed his huge dynasty start to fall apart in the later parts of 2008. Due to his gigantic appetite for money, Madollar was borrowing too much cash than he could keep. As the saying goes, he had bittern more than he could chew and he was being chocked. Investors wanted to see their assets liquidate their assets. Finally, the thief confessed. He realized that he had reached the end of the road, and his swift lies were over. He confessed to his two sons, Dave and Anthony Madollar, who were also his partners in the scheme. Unbelievably, the two sons turned him up to the FBI. Water was now thicker than the blood as it put an end to the Ponzi scheme. Owing to his arrest, he pleaded guilty in 2009. The poor man, at seventy years, was sentenced to one hundred and fifty years. I doubt if he will ever get out, but if he does, he will be 220 years old.
Watch Out for Ponzi-scheme
Madollar’s scheme was one of its kinds. However, there are uncountable similar cases taking place. They occur during economic quagmires when the lust and hunger for cheap and easy money is above the threshold. As a result, the victims are abundant. It is always advisable to watch out for the signs to avoid being trapped in the web. Ponzi schemes use unclear business models, aggressive sales techniques, and they promise higher returns for no work. Lastly, there are always difficulties experienced to withdraw funds.
Madollar organized the most professional fraud in history. He caused a lot of destructions and sent rippling effects to those he dealt with. His scheme was a major lesson to investors that such schemes can wear a legitimate and innocent face, so there is a need to be on the lookout.
Reflection of the Parody
The world is evolving, and so do the characters of people especially in business. The desire for more money in business has led to greed and other malpractices. Ponzi-schemes are example of the dishonesty that have proliferated the routines in the cash flow sector. In 2008, majority of American large and small investors woke up to the realization that they had been conned about $65 billion of their hard earned cash. Bernie Madoff was the brain behind this scam which its effects are still being felt. Kalen Smith writes about the scheme in his article, “What is Ponzi-Scheme? Bernie Madoff’s Ponzi-Scheme and Scandal Explained.” This paper paradises the article with the intent to caution investors.
Notably, in the paper, Madoff is referred to as ‘Madollar’ to show his strong linkage with money. This parody paper acknowledges the source of the article as it delves to explain the Bernie Madoff’s Ponzi scheme. Additionally, the names of his two sons, Mark and Andrew have been changed to Dave and Anthony for parody purposes.
The paper successfully makes fun out of the Bernie Madoff’s scam. It inflicts humor in Smith’s article which was originally lacking. Humor as a literary style is vastly used. Aside from that, imageries have been applied as well to build the parody. In this case, simile tools such as ‘as’ and ‘like’ are used. A vivid description is a vital tool of writing in this parodied article. Above all, hyperbole or exaggeration is prominent to ensure that fun is made out of the Bernie Madoff’s scheme. Significantly, as the paper invokes laughter in this situation, it aims at warning future or current investors to apply wisdom in the way they trade their money. Always be on the watch out for such fraudsters.
In a personal reflection, the parody has succeeded. The reason is that the copyrights remained with the original author, Kalen Smith, because of the changes that have been effected. The names of characters have been changed, and various styles of writing to create parody have been used. It could be improved, should there be a need, by adding more humor through the conventions of writing such as hyperbole, comparison and other similes.

Works Cited
Hurt, Christine. “Evil Has a New Name (and a New Narrative): Bernard Madollar.” (2010).
Smith, Felicia. “Madollar Ponzi Scheme Exposes the Myth of the Sophisticated Investor.” U. Balt. L. Rev. 40 (2010): 215.

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