Something that appears to escape notice is that, from the published reports, it does not seem that he was actually buying and selling stocks and shares, derivatives, sub-primes and commodities in the way which was the downfall of Bear Stearns, Lehman, and the other big banks and institutions. No counterparties have come forward to say “we wuz robbed.”
If this is so, then give or take a few tens of millions of personal expenditure, all the money that Madoff received from the present tranch of investors was paid out to previous tranches. In the absence of a six years statute of limitations the whole thing could be unravelled and everyone would be repaid their original investment less handling fees. Those who withdrew more than their original investment would have to cough-up. What is going to happen, of course, is that the Lawyers are going to take upwards of a third of whatever there is, for starters, and those who got out early will go scott free.
In an ideal world Congress would enact a special bill which would abolish the six year cut-off in this one instance, take the matter away from the courts and the lawyers and put it in the hands of a Commission. Accountants with access to IRS and overseas tax files would do the donkey work. Investors with offshore accounts might lose out which would not cause most folk a lot of anquish.
Is this a sensible idea, or am I also a Fuckwit?
Another aspect of the Madoff case, which has not received much thought from what I can gather. is that the $10,000,000 bail which Mrs Madoff put up must also have come from the investors robbed by Madoff. Madoff was supposed to be helping the prosecution with their investigation. If he is, it would be a good reason for them to let him stay in his Central Park pad. But if he is not, then it would be a good reason for him to be sent to the slammer. No one has said whether he is cooperating or not.
There is a very good article about Mrs M here. It begs the question of whether Madoff was totally insane or one of the most calculatingly evil men who ever lived. There is no possibility of anything between these two extremes. I have to say that if he were to end up on trial in a Gaza courthouse it would not be me who braved Hamas and the Israelis to go and rescue him.