I wikipedia-ed Ponzi Scheme to understand exactly what Madoff did. Truth be told, I have been pulling the nod-and-smile routine as everyone around me discusses Ponzi schemes as though they have estranged uncles or sketchy friends who first hand showed them the ropes. I thought for awhile that it was just a pyramid scheme, and imagined Madoff as the dude behind the scheme that screwed over Michael Scott in an episode of The Office (2.19, Michael’s Birthday)
Michael: So, Phil recruited me to sell these cards, and now I am recruiting you.
Oscar: Who is this guy again?
Michael: Don’t worry about Phil. He drives a corvette. He is doing just fine. Okay. Calling cards are… the wave of the future. These things sell themselves.
Ryan: Who uses calling cards anymore?
Michael: You know what? That’s a nice attitude, Ryan, I’m just helping you invest in your future, my friend.
Oscar: This sounds like a get rich quick scheme.
Michael: Yes! Thank you! You will get rich quick. We all will!
Toby: Didn’t you lose a lot of money on that other investment, the one from the email?
Michael: You know what, Toby? When the son of the deposed king of Nigeria emails you directly, asking for help, you help! His father ran the freaking country, okay? …Alright, so, raise your hand if you wanna get rich. [Jim and Dwight raise their hands] Alright.
Jim: No, um. How is this not a pyramid scheme?
Michael: Alright, let me explain. Again. [draws on board] Phil has recruited me and another guy. Now, we are getting three people each. The more people that get involved, the more who are investing, the more money we’re all going to make. It’s not a pyramid scheme, it is a… it’s not even a scheme per se, it’s… [Jim draws a triangle around Michael’s diagram] … I have to go make a call.
Apparently not. How Madoff got away with it for so long is a mystery to me.