It has been six years since one-time Wall Street superstar Bernard Madoff was arrested at his multimillion-dollar New York City apartment, ending a 50-year Ponzi scheme of epic proportions.
During the ensuing trial, prosecutors estimated the total size of the fraud to be around $64.2bn (£43bn). Almost as shocking, meanwhile, was the utter simplicity of the scam.
Madoff had, for an astonishingly long time, been running a scheme whereby new funds were used to pay existing investors, and so on.
Such schemes are doomed to fail because they invariably reach a critical mass and collapse under their own weight – at some point there simply is not enough new money to pay all the existing investors.
Remarkably, Madoff ran the fraud for the best part of five decades, masked as an angel of the markets, one-time chairman of the Nasdaq stock exchange and a name only to be whispered within the wealthiest circles.
Chasing Madoff is an engaging documentary – which is available on streaming services such as Netflix – that examines the story of Harry Markopolos, the lone voice who called on the US Securities and Exchange Commission to bring an end to Madoff’s long-running scam.
The film looks not only at how the Boston-based investment analyst uncovered the fraud – essentially sticking to the adage that a financial chart that only goes upwards is always hiding something – but also the ways in which his efforts affected his life.
Many of the case details used were already in the public domain but what makes Chasing Madoff so interesting is the human element of the story, following Markopolos and the handful of people who tried to aid him in his quest for justice.
Colleagues at Markopolos’s investment firm, Boston Consulting Group, double-checked his numbers and almost instantly agreed that this was the biggest scam in history.
The footage of regulators being hauled over the Congressional coals makes for fascinating, if slightly uncomfortable, viewing. Why, senior politicians ask, did they simply ignore the repeated warnings and 100-page dossier sent to them by Markopolos in which he pointed out the fraud?
Precious little is offered in response.
And why did the New York Times and Wall Street Journal remain so inexplicably inactive when given a lead on the story? It could be simply that nobody believed the emperor of Wall Street was really wearing no clothes, or it could be a more sinister reason. Sadly, that question also remains unanswered.
There is no line given from Madoff himself, who was languishing in a prison cell while the film was being made. Nobody from the Madoff family was interviewed; clients are shown only through recycled news footage.
Even so, Chasing Madoff is well worth the 91 minutes required to watch it because it tells the story of a man who devoted more than 10 years to uncovering the truth.
Finally, there is a lesson to be learned here: one cannot rob Peter to pay Paul for a great length of time without, eventually, getting caught.
Madoff pushed his luck for an astonishing 50 years but, ultimately, it came back to bite him. This is the story of how – and it is definitely one to watch.