The comparisons between Madoff and Bankman-Fried are unfair to Madoff. Really. The execution of the fraud makes the impact of FTX much worse.
In a Ponzi scheme the net impact is zero. It is robbing Peter to pay Paul. If you sum everything up, the total pie among those in the scheme is unchanged. You can do an accounting of who got fleeced and who received the fleece, and make restitution. Which is along the lines of what happened with Madoff. Total recovery to this point is 88% of the $19 billion of principal. (Sorry about the profits, those were mostly fake.)
With FTX, everyone is a loser. It’s gone. The bulk of the money was converted into crypto that is now worthless. Or stolen. Money spent on real estate in the Bahamas and the private jets used to fly Amazon packages to home base are rounding errors in the grand scheme of things.
‘Enforcement 40’ for 2020
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