The Wizard of Lies: Bernie Madoff and the Death of Trust
Diana B. Henriques
"An impressive, meticulously reported postmortem. . . . The Wizard of Lies is the definitive book on what Madoff did and how he did it." ―Bloomberg Businessweek
Who is Bernie Madoff, and how did he pull off the biggest Ponzi scheme in history?
This question has fascinated people ever since the news broke about the New York financier who swindled his friends, relatives, and other investors out of $65 billion. And in The Wizard of Lies, Diana B. Henriques of The New York Times has written the definitive book on the man and his scheme, drawing on unprecedented access and more than one hundred interviews, including Bernie Madoff's first interviews for publication since his arrest. Henriques also provides vivid details from the lawsuits and government investigations that explode the myths that have come to surround the story, and in a revised and expanded epilogue she unravels the latest legal developments.
A true-life financial thriller, The Wizard of Lies contrasts Madoff's remarkable rise on Wall Street with dramatic scenes from his accelerating slide toward self-destruction. It is also the most complete account of the heartbreaking personal disasters and landmark legal battles triggered by Madoff's downfall―the suicides, business failures, fractured families, shuttered charities―and the clear lessons this timeless scandal offers to Washington, Wall Street, and Main Street.
Mike Engler in Minneapolis soon after 1986 that he was opening his “institutional” money management business to individual investors for the first time, another plausible cover story. Until 1985, Peter Madoff occasionally signed redemption checks for Ruth’s relatives, but no one recalls him doing so after that date. It was during the mid-1980s that the “friends and family” accounts originally set up by Saul Alpern began their astronomical growth under Avellino & Bienes, perhaps funneling more
early 1980s. Picower’s adversaries in later corporate battles would remember him as hard-edged, aggressive, and highly litigious, a man who skirted the edge of market rules and fair play time and again. Those takeover battles would put billions of dollars into his pockets—and, ultimately, into his Madoff accounts. Among the quartet of early Madoff customers, Picower stood out as the only one with whom Madoff seemed to feel ill at ease. In a written response to questions posed after Madoff’s
July 1987, the market climbed almost straight up—the S&P 500 gained more than 30 percent in just seven months. It stumbled in the remaining months of the summer—an overdue correction, analysts said—but it still eked out a gain for the first nine months of the year. Then came Black Monday, October 19, 1987, when the bottom simply fell out. A record-cracking 600 million shares were traded on the Big Board that day, as the Dow Jones Industrial Average plummeted 508 points—a 22.6 percent fall, more
provided no prospectus, and maintained minimal records. Word spread, and in time Retirement Accounts Inc. was the administrator for hundreds of self-directed IRAs invested with Madoff. After several takeovers and mergers, it became a unit of Fiserv Inc., a giant financial services company. By 2008 it would be handling roughly eight hundred self-directed IRAs invested with Madoff, the value of which was said to exceed $1 billion. Another way for middle-income Americans to gain a stake in hedge
last visit with Bernie Madoff. There is no independent account of what is being said inside his glass-walled office—indeed, according to the trustee, Madoff routinely directed that all records of his dealings with Kohn be destroyed—but the checkbook he uses for his Ponzi scheme suggests that the news is bad. Nine days from now, Madoff will write a check for $113 million to cover redemptions from the Herald fund, a mainstay of the Bank Medici network. A month later, he will write the fund another