What was Bernard Madoff's money-making scheme?

Answer 1

Bernie Madoff is responsible for creating and running a large Ponzi investment scheme. In simple terms, a Ponzi scheme (named after a man of the name of Ponzi who was first credited with using this type of get-rich-quick methos of money) is where initially investors put in large sums of money. Madoff then gave large percents of that back, calling it the intrest made from the investment. The investors, believing that Madoff was investing their money wisely, invested more money. As new investors came in, their money went towards the fake-intrest-earnings for earlier investors, as so on. A majority of the money was taken (illegally) by Madoff and spent. It is suspected that millions and millions of dollars exist in private off-shore accounts and, due to their privacy, will never be known or recoverred.