‘Madoff: The Monster of Wall Street’: The 9 Most Shocking Takeaways

The Bernie Madoff case has been covered dozens of times before. But what makes The Monster of Wall Street notable is its ability to fully explain and dramatize this Ponzi scheme. Roughly two episodes of the more than four-hour series are devoted to logistics. Through this retelling, Frank DiPascali becomes as big of a name as Bernie Madoff.

When Bernard L. Madoff Investment Securities moved to the Lipstick Building, the operation had two floors: the 19th and the 17th. The 19th floor was where the legitimate trading took place, but the 17th floor was run by Frank DiPascali. Basically, the 17th floor took in the money of various clients and claimed it was investing those sums. In reality, Madoff deposited all of this money into an account with JP Morgan Chase. When he made bigger trades on the 19th floor, he was able to hedge his stock purchases with this ill-gotten sum. Meanwhile, his clients were sent fake reports that claimed their investments were steadily gaining value.

Though the basic idea of a Ponzi scheme is relatively simple to understand, how Madoff organized this one has long been a source of confusion for many casual observers. The Monster of Wall Street does a good job of thoroughly explaining the logistics of this operation while utilizing dramatizations to keep things interesting. If financial reporting gives you a headache, you’ll probably have better luck with this docuseries.

When it comes to how much money Bernie Madoff took from his victims, a lot of numbers have been thrown around over the years. Some have claimed the number is as high as $64 billion, which takes into account the amount clients invested with Madoff as well as how much they thought they earned on those investments. But the number that The Monster of Wall Street lands on is $19 billion. That is the amount people and organizations invested with Madoff, not counting any profits he claimed they made.

As horrifying as this story is, there is a second, equally depressing chapter to it. After Madoff admitted to his Ponzi scheme and was arrested, his victims were owed the money they had initially invested with him. The problem was most of that money was already gone. Enter Irving Picard.

Through relentless lawsuits, the trustee was able to recover a jaw-dropping $14 billion of the original $19 billion. Some of that recovered money came from uber wealthy investors that many believe knew of the scam. For example, Norman Levy had to pay back $220 million, Stanley Chais had to pay back $277 million, and Carl Shapiro had to pay back $625 million. But because of the way Picard went about recovering these lost funds, many everyday people were also hurt

Picard framed his lawsuits so that anyone who made money through the Ponzi scheme had to return it, a contractural provision known as clawback. This applied to the bigwigs who repeatedly bailed out Madoff. But it also applied to the everyday people who knew nothing of the scam and happened to take their money out before the Ponzi scheme was exposed. People who had avoided the first round of loss — many of them elderly — lost their savings, houses, and had to leave retirement to return to the workforce.

It’s not that the Madoff scheme was so intricate that it was impossible for people to detect. Harry Markopolos, a forensic accounting and financial fraud investigator, claims that he figured out that Bernie Madoff’s wealth management business was a huge Ponzi scheme after about four minutes of looking over the returns of one of Madoff’s clients. From 1999 to 2008, Markopolos gathered evidence to prove that Madoff was orchestrating a scam. He even alerted the Securities an Exchange Commission (SEC) to his suspicions in 2000, 2001, and 2005 and supplied supporting documents. Each time the SEC either ignored him or gave his evidence a cursory look. At one point, the head of the SEC merely called Madoff and asked him if he was doing anything illegal. When Madoff denied it, he was taken at his word.

Markopolos was called to testify in front of Congress during the investigation. “I was told it was the most heated Congressional testimony since Watergate,” Markopolos says.

Though it was far too large for one person to keep track of, Madoff claimed that only he knew of his Ponzi scheme. Several people were found guilty in connection to this mass fraud, including Madoff, his brother Peter Madoff, Frank DiPascali, and five former aides. But the list of people who served time for this massive scandal is relatively small. Other documentary subjects argue that Madoff’s arrest served as the sacrificial lamb for the 2008 financial crisis and that many others related to this systematic collapse were spared because of his arrest.

“[The feeder funds] culpability was a complete failure of due diligence, which is their job,” Jim Campbell, author of Madoff Talks: Uncovering the Untold Story Behind the Most Notorious Ponzi Scheme in History, says. “I think the owners of Fairfield Greenwich, Sonja Kohn, all those folks, they should have gone to jail.”

This is a claim made by multiple interview subjects in the docuseries. Instead of investing his clients’ money, Madoff deposited most of it into an account with JP Morgan Chase. Between 2003 and 2008, Madoff deposited between $3 billion to $6 billion into that account. Typically, under the Bank Secrecy Act, if you transfer more than $10,000 and a bank does not have a clear understanding why that transfer occurred, it generates a Suspicious Activity Report. That report is then sent to the authorities. That step was seemingly not taken with Madoff.

“How do you transfer billions of dollars on phony transactions back and forth at major banks and not generate a SARs report?” Frank Casey, a former executive for Rampart Investment Co., asks.

In the wake of this scam being exposed, two people ended their lives: Rene-Thierry Magon de la Villehuchet and Mark Madoff. Villehuchet was one of the founders of Access International Advisors, and The Monster of Wall Street argues that he likely did not know of the scheme. He lost $1.4 billion working with Madoff. The second suicide was that of Mark Madoff, Bernie Madoff’s son and one of the whistleblowers on his father’s crimes.

There was one other major death associated with this case. Jeffry Picower was the largest beneficiary of Madoff’s scheme. During a time when people were seeing market returns of about 9 percent, Picower was seeing staggering returns of 950 percent. In the middle of Picard’s lawsuits, Picower suffered a heart attack and accidentally drowned in his pool. His widow later agreed to have his estate settle the claims brought against it to the tune of $7.2 billion. It’s the largest single forfeiture in American judicial history

This tiny detail is indicative of Bernie Madoff’s reputation with his family and friends. In 2021, Bernie Madoff died at the age of 82 while he was still in prison. Though he was Jewish, his body was cremated. The Monster of Wall Street claims that Madoff’s family refused to claim his remains and this his ashes are still sitting in a lawyer’s office.

This may be the most chilling part of this disturbing docuseries. Bruce Dubinsky was an expert witness during the Madoff case who appears multiple times in The Monster of Wall Street. “Could there be another Bernie Madoff in the future?” Dubinsky asks in the final episode. “There will be another Bernie Madoff in the future. That will happen. Mark my words.”

His words are echoed by Markopolos: “The Madoff case, it’s a record-breaking case as of 2008. But remember: Records are made to be broken.”