Book review: Madoff ruined his own life along with many others

By now most people have formed an opinion about Bernie Madoff, the mastermind behind the astonishing $65 billion dollar Ponzi scheme that shattered the finances of celebrities, charities, middle-class investors, close friends and his own family. That opinion is most likely one of disgust, anger and disbelief that someone could commit such an atrocity.

Yet after reading “The Wizard of Lies” by Diana B. Henriques, my view of Madoff has changed somewhat. I now see the human failings of the man, and I’m amazed at how he was able to pull off such a scam.

In her new book, just out in paperback, Henriques explores who Madoff is and how he was able to carry the scam off for so long. She documents the day-to-day operations of the scheme and its ultimate slide toward dissolution.

What I found most riveting about the book was the devastating toll Madoff’s actions took on his family. His wife, Ruth, was the only one of his immediate family that still had contact with him shortly after his arrest. Madoff’s youngest son avoided both parents; his oldest son, Mark, committed suicide in 2009.

Henriques is a New York Times financial reporter, and she wrote most of the paper’s coverage of this story when it broke back in December of 2008.

‘The Wizard of Lies’

Author: Diana B. Henriques

Published by: St. Martin’s Press, 364 pages

How much: $15.99

She has had unmatched access to Madoff and his family, and this is the definitive account of the largest Ponzi scheme to ever hit the global financial markets.

She writes that Madoff’s earliest scheme occurred in 1962, when he borrowed money from his father-in-law to conceal losses. Henriques writes, “How much of Madoff’s version of his early success in riskless arbitrage trading is true? The line between true and false is very hard to draw so long after the fact, especially given Madoff’s masterful fluency in both truth and lies.”

Extensive detail

The book goes into much detail about how Madoff was able to carry out his Ponzi scheme for so long. For years he eluded the Securities and Exchange Commission and his firm even printed fake monthly statements for clients.

The clients were happy to be making a steady profit through the years until it all came crashing down with the worldwide financial collapse of 2008.

Lecture at Saint Rose

On Thursday, Henriques will present a lecture, “Madoff and More: Unmasking the Legacy of Greed and Corruption” at 6:30 p.m. at the Touhey Forum at the College of Saint Rose in Albany. The cost, $25, will benefit the Women’s Press Club of New York State’s Scholarship Fund.

There is also a VIP reception for $75 immediately following the lecture, and books will be available for purchase and signing. A complimentary book is a benefit at the VIP level.

Tickets are available at The Book House in Stuyvesant Plaza in Albany and The Open Door Book Store in Schenectady. For more information, call 878-9403.

“It was an era when people desperately wanted something solid to believe in,” writes Henriques.

“The 1970s seemed like the decade that would ruin Wall Street. The contrast between Wall Street’s dismal state and Madoff’s apparent success with his arbitrage trading only enhanced his reputation.”

With the election of President Reagan in 1980, Madoff had an opportunity to really expand his money scheme. The new president began to hack away at what he saw as generations of needless government regulation.

This weakened the Securities and Exchange Commission and allowed Madoff to more easily expand his fraud undetected.

This book at times reads like a thriller, and there were a few occasions when one of the regulatory agencies was about to figure out Madoff’s deception only to have him pull off some trick and walk away unscathed.

Did Madoff’s wife and his two children know about his elaborate scheme? Henriques still is not sure, but no one in the family other than Bernie has ever been charged.

Yes, the man has destroyed so many people, but reading this book you will understand how he also destroyed himself, his family and his closest friends. He has very few visitors in his North Carolina jail cell — even his wife is estranged from him now.

In January, Henriques visited Madoff and found him to be depressed. “My health is as good as can be expected for now,” he told her, “but as you can imagine I miss my family so much I find it unbearable. After more than 50 years of constant togetherness, both emotional and physical, it’s as if I have no soul left. I blame myself for so much.”