Go Directly to Jail

Bernard Madoff is going to jail for life. Today he pleaded guilty to 11 counts of fraud, money laundering, perjury and theft.

His Ponzi scheme defrauded the rich of possibly $65 billion, but it has also harmed the very poor.

Madoff was never caught by the SEC despite a damning report by independent financial fraud investigator Harry Markopolos, despite 8 separate investigations over 16 years, despite a French bank spotting the risks. Instead the shady business came to an end when Madoff confessed to his two sons who then turned him in to authorities.

Portfolio.com has all the details on how Madoff plotted the fraud. The account statements he sent to investors were "elaborate works of fiction," and it appears that no securities were ever even purchased for his customers.

It's an understatement to say Bernard Madoff is a despised man. At Thursday's court hearing, before he was handcuffed and led away with applause, the courtroom spectators laughed when Madoff's defense lawyer described the conditions of his client's house arrest and how Madoff had, "at his wife's own expense," paid for private security at their Manhattan home. His wife will have a hard time proving any of her money is untainted.

In fact, the whole idea that Madoff could possibly be the "single bullet" responsible for the complex crime is ridiculous. But Madoff turned down the chance for a plea deal when he wouldn’t agree to plead guilty to conspiracy. He's not cooperating, and so the investigation has only just begun.