This week we will be talking about the biggest financial crimes of all times. This crime was conducted on the wall street by an investment banker who started trading of penny stocks when he initially founded the company, but eventually got into ponzi advertisement of his investment strategies.

Bernie Madoff started his investment business in the year 1960s that dealt primarily with buying and selling of penny stocks and their subsequent endorsement to their customers. His initial investment into the business was merely US $5,000 which later went to become billions of dollars. This billion-dollar company was started by a single man, however, by the time the fraud was busted, it had become a family run business in which the father – Bernie Madoff, his son and his brothers were involved.

All this being said… Let’s come to the main question – How was this crime done? And, what was the crime?

This crime was done as a culmination of a series of well-organized events that had an objective to obtain maximum possible profit from possible legitimate and illegitimate sources. Madoff investment corporation was involved in daily trade for many clients. Their investments formed the basis for their commissions and hence, they were motivated to invest their clients’ money in the best possible manner. However, in the greed to earn more profits, Madoff Investments used special software’s that introduced stock results from a previous data that had values that were marginally lesser than the actual market rates.

In the entire process, consumers did have a hint of a suspicion on his activity, however, they were not very concerned on contesting the investment firm because they did not lose a lot of money through data misrepresentation. As a result, they were able to take out a large portion of people’s incomes from their stock earnings through illegitimate means.

The problem rose when the overdid it with a big-shot customer. The transactions lost for the said customer were valued around 120 thousand US dollars. And thus, he decided to fight the company. On inspection, the SEC found that the fraud was worth US $64.6 billion. Madoff, because the fraud had been conducted over a course of 40 years, has been put on life arrest for a total time period of 150 years.