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Urged on by the handful of loyal readers of DamageContro101, one of my New Year’s resolutions is to do a better job of updating this blog. Please feel free to hound me whenever possible. So here goes.
I have been wracking my brain trying to figure out this whole Bernie Madoff thing. Not the part about how could his investors have been so greedy, not recognized the warning signs, allowed themselves to be ruined, etc. (full disclosure—my parents invested a small sum of money with Madoff several decades ago, and their accountant, upon seeing the sparse annual statement, told them it was highly suspicious and to get out, which they did). I will leave it to the armchair psychologists for that analysis.
As a damage control specialist, what I don’t understand is why Madoff didn’t have an exit strategy. When asked what the person should have done in cases where guilt with criminal consequences is inescapable (think Spitzer, as another example, or read MSNBC Legal Analyst Dan Abram’s assessment of the Illinois Governor’s predicament on the DailyBeast.com), my advice tends toward the “leave the country†variety. In other words, when it is clear that you can’t talk your way out of this one, the only sensible thing to do is to flee.
In Madoff’s case, assuming he has been running his Ponzi scheme for decades, he should have had plenty of time to purchase a nice estate under an assumed name in, say, Venezuela (no extradition treaty, not exactly on good terms with the U.S. government, etc.), set up some secret contingency funds, paid off the requisite local officials, and had a hard-to-trace route to live out the remainder of his life. It worked for Marc Rich and Robert Vesco.
I have narrowed it down to two theories of why he didn’t do so, neither of which involves guilt or remorse–I have seen no evidence that Madoff actually feels sorry for what he has perpetrated.
First, he may have been caught so flat-footed that he never, ever, believed his Ponzi scheme would come to an end. There is some logic there, because if the economy hadn’t totally tanked last fall, requiring a critical mass of his investors to need their money back to cover other failing investments, he might very well have outlived his fraud. There seemed to be an endless supply of want-to-be Madoff investors lined up in every wealthy Jewish community across the country. The Ponzi scheme could have gone on for decades more.
Or second, his attorney may have told him, don’t worry about it. It will take the government several years to unwind your adventures before they will lock you away, and who knows, maybe you will get off, or die before then.
Alternative theories are welcome.
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