when clients sought to redeem their investments madoff funded the payouts with new capital which he continued to attract through a reputation for unbelievable returns and by grooming his victims madoff cultivated an image of exclusivity often initially turning clients away 
this model allowed roughly half of madoff s investors to cash out at a profit these investors have been required to pay into a victims fund to compensate defrauded investors who lost money madoff created a front of respectability and generosity impressing investors with his activities on behalf of charities in fact many nonprofits were among his victims about 10 of the money he swindled came from nonprofit organizations according to the new york state attorney general s office 15madoff s plausibility to investors was based on several factors the sec had been investigating madoff and his securities firm off and on since 1992 a fact that frustrated many after he was finally prosecuted since it was felt that much of the damage could have been prevented if the initial investigations had been rigorous enough 17financial analyst harry markopolos was one of the earliest whistleblowers in 1999 he calculated in the space of an afternoon that madoff had to be lying he filed his first sec complaint against madoff in may 2000 but the regulator ignored him in a scathing 2005 letter to the securities and exchange commission sec markopolos wrote madoff securities is the world s largest ponzi scheme in this case there is no sec reward payment due to the whistle blower so basically i m turning this case in because it s the right thing to do 18many felt that madoff s worst damage could have been prevented if the sec had been more rigorous in its initial investigations it was not until 2005 shortly after madoff s firm nearly went belly up due to a wave of redemptions that the regulator asked madoff for documentation on his trading accounts he made up a six page list the sec drafted letters to two of the firms listed but didn t send them and that was that the lie was simply too large to fit into the agency s limited imagination writes diana henriques author of the book the wizard of lies bernie madoff and the death of trust which documents the episode the sec was excoriated in 2008 following the revelation of madoff s fraud and their slow response to act on it eight employees faced disciplinary action but none were fired 19in november 2008 bernard l madoff investment securities llc reported year to date returns of 5 6 despite a 39 decline in the s p 500 during that period 20 as the selling continued madoff could no longer fulfill the cascade of client redemption requests so on dec 10 according to the account he gave fishman madoff confessed to his sons mark and andy who worked at their father s firm the afternoon i told them all they immediately left they went to a lawyer the lawyer said you gotta turn your father in they went did that and then i never saw them again bernie madoff was arrested on dec 11 2008 21madoff insisted he acted alone though several of his colleagues were sent to prison his elder son mark madoff committed suicide exactly two years after his father s fraud was exposed 22 andy madoff died of cancer at age 48 in 2014 23madoff was sentenced to 150 years in prison and ordered to forfeit 170 billion in 2009 his three homes and four boats were auctioned off by the u s marshals 24on feb 5 2020 madoff s lawyers requested that madoff be released early from prison claiming that he was suffering from a terminal kidney disease that would kill him within 18 months 25madoff prisoner no 61727 054 remained at the butner federal correctional institution in north carolina until he died in the prison hospital on april 14 2021 the paper trail of victims claims displays the complexity and sheer size of madoff s betrayal of investors his final account statements which include millions of pages of fake trades and shady accounting show that the firm had 47 billion in profit 26while madoff pleaded guilty in 2009 and was sentenced to spend the rest of his life in prison thousands of investors lost their life savings and multiple tales detail the harrowing sense of loss victims endured 27as of late september 2022 about 4 billion was returned to some 40 000 of his victims via the u s department of justice s madoff victim fund 28depictions of bernie madoff in popular culturebernie madoff has been depicted as a villain in the media and pop culture in a 2009 episode of hbo s curb your enthusiasm jason alexander who played george on seinfeld is swindled by madoff and loses all of his money madoff or similar knock offs appeared in woody allen s film blue jasmin and in elinor lipman s novel the view from penthouse b in 2017 madoff was played by robert deniro in the hbo film the wizard of lies several documentaries and books have recounted madoff s fraud and his fall who was bernie madoff bernie madoff was an american financier who orchestrated the largest ponzi scheme in history collecting about 65 billion that he had no intention of investing bernie promised investors high returns in exchange for their investments but their money was not invested madoff deposited it into a bank account which he freely used to fund his lavish lifestyle withdrawals were funded out of new deposits keeping the fraud going for decades during the 2008 recession madoff could no longer meet the redemption requests his sons turned him in to the authorities madoff was convicted of fraud money laundering and other related crimes for which he was sentenced to 150 years in federal prison he died in prison on april 14 2021 at the age of 82 