> The system tends to be very good at punishing rich people that swindle money from other rich people.
… Eventually? I'm surely not the only one who thinks of Madoff first, and he got away with it for almost a decade after suspicions were first reported.
> Crazy that people think they can get away with this stuff. Ponzi schemes seem guaranteed to blow up over a long enough time horizon.
I just finished a podcast on Madoff, and I found myself wondering if he just assumed he would eventually get caught. The man lived like a literal king for like 40 years, and only got caught in his 70’s. It’s not a tradeoff that I would take, but I wonder if for some people, prison is the assumed endgame, and the goal is to keep the plates spinning for as long as possible.
> As for anyone who thinks those who commit this kind of fraud shouldn't go to jail, I'd say jail is about the one thing the rich are afraid of. If you have $20m then a $3m fine might suck but it's not the end of your world. A year in jail in so much worse.
Except the intention here obviously was not to defraud, but to follow the law, which was so incomprehensible as to make even professionals fall into its traps. And it's not "the rich" going to jail here, but the professionals that are responsible for making that mistake. Maybe that professional happens to be "rich", but most people involved will walk free, as long as there's a scapegoat.
No, people shouldn't go to jail for this. These regulations shouldn't even exist. Even "socialist Europe" isn't as bad as the US in this regard.
> An interesting part of Madoff recoveries were through settlements against originators/feeder funds because they « ought » to have known it was a ponzi.
Did the judge say that? I would think the logic was that they were effectively getting stolen money as gifts. Like when a scammer gives their victims' money to their own family. Doesn't matter if they were in the dark or even spent it already.
As I understand it, if stolen/scam money is used to buy something it's not the seller's responsibility because money is legal tender. On the other hand, if a stolen item is sold, the issue of knowing where it came from does becomes important.
> embezzler spots an opportunity to get back some of what they are owed, they strike, and are successful. Then it spirals from there.
This strikes me as the typical fraudster more than embezzler. Making up investment returns versus running an otherwise-successful business while stealing the money. Madoff was a fraudster; Bankman-Fried more an embezzler.
> At least some of the fraud which did occur resulted in prison time.
Could you point me to any examples? When I looked into this the only person to serve prison time during this period was Bernie Maddoff and his great crime was stealing from the rich.
> Morally, I think people like Madoff are worse than many gang members or low-level violent criminals
Out of curiosity, why do you think this? Grand theft of wealth based on fraud doesn't strike me as morally worse than gangbanging, armed robbery, human trafficking, etc.
(To detail my own calibration, I would say someone like Henry Kissinger is morally worse than low-level criminals. Typically I think it goes theft < violence < warmongering, etc.)
Bernie Madoff might be close to an example; his scheme kept going for an _amazingly_ long time, and he made some effort at times to reduce inflow to keep it somewhat under control. There was probably a world in which it only came out after he died; as it was he was kind of unlucky with the timing.
Of course, there might be plenty of optimally greedy criminals out there, and you’ll never know; more or less by definition they do not get caught.
> Can't wait to see many many more of these prosecutions over the coming years. So much fraud out there now though it feels like only the very unlucky or very careless will get caught just on the sheer number of cases and types of fraud being perpetrated.
I had to take a look at my calendar and make sure we weren't in 2008, because this is exactly the same kind of sentiment everyone should have for the Banksters on Wall Street who destroyed the Global Economy that ruined the economy, whose implications we still have to live with to this day: 21 million is chump change and the guy is looking at this sentence:
Stollery faces up to 20 years in prison if convicted, officials said.
The FBI put a manhunt bounty for info on that woman from Onecoin, as well, but Jamie Dimon, or Lloyd Blankfeind (both who's organizations have since become favourable to Bitcoin mind you) get to walk free and still do speaking engagements; hell even Jon Carzine (former NY Senator) was out shopping for chalets in France after he blew up MF Global.
Financial crime, specifically fraud, is the most blatantly tiered of all crimes in the US, if you're already wealthy and influential you get a slap on the wrist and you move on as a cost of doing business, but if you're poor and a nobody and get caught they will throw the book at you.
Personally, I'm glad this guy selling garbage and defrauding people is going to prison, but we should hold everyone to the same standard (MBS, CDS, CDO were all garabage, too) what I fear is that those who can do it at a much larger scale (Wells Fargo Repo scam, BOA bank fee layering etc...) will always get away with it.
>It's undeniable he committed fraud, repeatedly lied to his clients and tried to make them give him money by telling them tales that weren't true.
What on earth is the difference between this and Madoff?
>But it also seems likely he thought he was clever/lucky enough that it would all work out in the end.
What on earth is the difference between this and Madoff?
>That makes the intent different
Why do you assume bad intent in one case and none in the other? SBF stole customer money and used it for political donations during one of the most heated, divisive, controversial elections in recent American history. He's the sitting President's largest donator, and he's going to prison for fraud. The potential consequences here are massive.
Really? Equivalent to a $50 billion ponzi scheme in which thousands of people lost their pensions and become destitute? That's the same as denying a few thousand dollars to already very highly compensated engineers? I'm not excusing what they're doing but the Madoff comparison seems off.
> "Bernie Madoff didn't think he was doing anything wrong either."
Do you have a source for that? I would have expected that he knew that what he was doing was wrong, but did not care because he was greedy. Disagreeing with a law and disregarding the law are two separate concepts. People often do one without doing the other.
His apology that he delivered before sentencing suggests that he knew it was wrong. Of course it would be incredibly foolish to take such an apology at face value, but it would be interesting if there are any statements made by him at other times that contradict this.
… Eventually? I'm surely not the only one who thinks of Madoff first, and he got away with it for almost a decade after suspicions were first reported.
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