Madoff's Betrayal

I've been weighing the cultural fallout from Wall Street investor Bernard Madoff's recent admission to authorities that his financial firm was just an elaborate scam.

The majority of the media attention about the curious case of this entrenched financial con artist (pictured left) has been focused on the alarming scale of the scheme, the failure of government agencies to react to the warning signs and the high-profile investors he swindled.

But what kind of impact will this shameful $50 billion scandal have on our country and culture? The extent of the damaged to his victims clearly goes way past money.

Rene-Thierry Magon de la Villehuchet was a descendant of French royalty and sailing enthusiast whom many wealthy European investors (including members of the Rothschild family) entrusted with growing their capital in US markets.

He was just one of the wealthy fund managers who watched their investments vanish into thin air after Madoff's multi-billion dollar Ponzi scheme unraveled recently.

In the early hours of Tuesday morning December 23rd, just two days before Christmas Villehuchet was found dead at his desk his New York City office with his wrists slashed after he'd spent days trying frantically to recoup some of the $1.4 billion he'd invested with Madoff.

There were politicians impacted as well.

New Jersey Senator Senator Frank Lautenberg's charity lost money. On Christmas day Associated Press journalist Angela Delli Santi reported that New Jersey State Senator Loretta Weinberg, a 73 year-old grandmother was also one of Madoff's victims after her Los Angles-based money manager Stanley Chais informed her that their money had been invested with Madoff's firm - and there was nothing left of the $1.3 million she and her family had unknowingly invested with Madoff.

Her story was echoed in the Blogosphere as well.

Was it really worth it for Madoff? His once-sterling reputation on Wall Street will forever be overshadowed by the truth of the deprived nature and depth of his greed and deception.

I haven't seen a lot of mainstream media discussion about the impact on the Jewish community.

Nor have I seen a lot of dialogue about the unfortunate reality that the incident only serves to fuel the simmering stereotypes fueled by the age-old anti-Semitic images and distorted caricature of the "greedy Jewish banker" which still run through the fabric of this nation and in many parts of the globe.

I say that as an African-American guy who gets sick of hearing media headlines about ignorant criminal acts committed by young black men; it's not just that it's an embarrassment to the black community as a whole when I read about some kid in Brooklyn who attacks and beats an elderly woman of color in her building elevator for 30 bucks. To me that's a disturbing sign we ALL need to pay attention to.

So I wonder how Jewish people feel about Madoff.

How does a man pass himself off as a wealthy, well-connected financial genius for decades when he's just a guy who uses knowledge of the stock markets & institutional investing, common sales techniques, and a fictionalized word-of-mouth reputation to play on people's greed and loyalty to their faith?

I'll leave it to writers with far more expertise in the complexities of financial oversight to uncover the wordy, numbers-laden details surrounding exactly how this slick hustler pulled this off under the scrutiny of government regulatory agencies like the Securities and Exchange Commission.

Award-winning NY Times financial reporter Diane Henriques offered one of the best pieces I've read on the scandal and the man behind it; it helped offer some perspective to this complex case.

We're looking at a man who spent years on golf courses in the US and ski slopes in Europe culling relationships with influential investors, financiers, celebrities and bankers (often based on their shared Jewish heritage) and selling them an intoxicating cocktail of false word-of-mouth assurances of trust, inflated hard-to-believe yearly returns and the alluring promise of belonging to an elite company of prominent investors based on religious ties and wealth.

Bernie never used the hard sell, you had to be "referred" to him.

While hard work helped propel Madoff to the top of Wall Street and his early belief in electronic trading reflects his foresight, he is certainly not some kind of financial prodigy or market wizard as he was oft-called; for instance, according to the New York Times he had personal relations with one of the SEC officials charged with oversight of his "firm".

Even in normal circumstances there's something inherently distasteful about about a scam artist who serves his own greed by taking advantage of others in order to line his own pockets. But in the current economy it takes on a nauseating and distinctly un-American quality; even if he was duping the rich.

The Yeshivaworld.com Website offers interesting insight into the New York Hasidic community's thinking on current events. There are some Jewish people from New York who simply dismiss Madoff because he's not "really" Jewish.

A mistake is only a mistake if we learn nothing from it. Let's hope this doesn't just become another cultural marker of our times, another opportunity for people to make money.

What a sad statement of the inherent greed that in many ways defines our current culture.