Bernie Madoff, RIP 

Bernie Madoff is considered by many to be the greatest con artist of all time. At the Cigar Club last night, one friend said he had “stolen” $46 billion. Another said it was higher: $65 billion. Neither of those statements is true.

It is true that Madoff was running a Ponzi scheme, using new investors’ dollars to pay dividends to old investors’ funds. His explanation was that he got caught up in the scheme in the early 90s when his portfolio went south. Rather than report the truth to his clients and lose his up-to-then sterling reputation for delivering steady, double-digit returns, he decided to cook the books, hoping that one day the portfolio would start to move up and he could make his investors whole.

Almost no one believes that. Maybe not even his wife. But it seems plausible to me. Here are the facts: Over more than 20 years, his firm took in $19 billion from roughly 4,000 clients, including some A-listers. At the time of his arrest, his firm was fraudulently claiming to have assets of $65 billion. After he was convicted in 2009, a court-appointed trustee recovered more than $14.4 billion, which was returned to investors. $14.4 billion is $44.6 billion less than $65 billion. But the actual loss to investors? That was only $4.4 billion, or 25% of their capital.

That sort of thing happens on Wall Street every day.