The Disintegration of White-Collar Criminal Bernie Madoff


In December 2010, Bernie Madoff contacted the Financial Times to say that he was ready for his second prison interview. It had been two years since news broke of Madoff’s 16-year, $65 billion Ponzi scheme, and just 17 months since he began serving his 150-year sentence. By the time he was interviewed, his oldest son, Mark, had hanged himself on the second anniversary of Madoff’s arrest, and his younger son had broken off all contact.

So why would an educated, seemingly intelligent Wall Street insider risk everything—including his well-being and that of his family—to perpetuate a massive fraud that was bound to fail? Is it even possible to chart Madoff’s disintegration from successful investment manager to bankrupt prisoner? His most cogent explanation in the Financial Times interview offers a clue: “I have spent a lot of time . . . trying to figure out how I could have done it . . . [T]he thing is that you can compartmentalize things in your life.”

Madoff’s statement describes in a nutshell what becomes clear in the rest of his interview; he has an uncanny ability to compartmentalize, fragment, and quite literally “dis-integrate” each piece of his story from the overall picture. His fractured construct probably shielded him on some level from the havoc he chose to wreak on family, friends, colleagues, and clients. When he describes the fraud now, it’s as though he is looking into a shattered mirror, giving answers that seem plausible in isolation but are untenable when viewed as part of the whole.

A couple of examples from the Financial Times interview demonstrate how Madoff’s perception of himself and of the world is persistently, if not pathologically, disintegrated.

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DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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