Describe three types of illegal business behavior alleged against Mr. Madoff and for each type of behavior, explain how the behavior is illegal or unethical in the conduct of business.
Three illegal business behaviors by Madoff were conspiracy, securities fraud, money laundering, and perjury. Conspiracy is “Agreement between two or more persons to commit an unlawful act or to accomplish a lawful end by unlawful means” (Merriam-Webster Dictionary, 2011). Although Madoff originally stated that he was the sole mastermind behind the Ponzi scheme, others have come forward and plead guilty to assisting Madoff with covering the scheme. Madoff violated the Securities and Exchange Commission with securities fraud; Madoff manipulated many companies, foundations, and banks by purchasing stock without having adequate funds to purchase stock. He actually never even purchased any stock but merely placed money into a personal bank account and paid out money with money he received from new investors. He also was accused of money laundering, in which he placed money into shell companies and offshore trusts and pretended to purchase and trade stock with other countries. Madoff also was accused of perjury. Perjury is “an act by a person who takes an oath to tell the truth yet willingly and contrary to such oath states a material matter that he or she does not believe to be true” (Bagley & Savage, 2010, pg. 626), which is simply lying under oath. Bernard Madoff is a former American stockbroker, investment advisor, and non-executive chairman of the NASDA. In 2009 he plead guilty to the accusations against him and was sentenced to 150 years in prison for conspiring one of the largest Ponzi schemes ever which lasted for almost 20 years.
Name three types of parties who were impacted by the actions of Mr. Madoff and describe how they were impacted.
Three types of parties who were impacted by the actions of Mr. Madoff were the banks,...