Madoff: A Riot of Red Flags

For more than seventeen years, Bernard Madoff operated what was viewed as one of the most successful investment strategies in the world.

Author(s):

Greg N. Gregoriou

Professor de Finance, SUNY Plattsburgh

Francois-Serge Lhabitant

Professeur Associé de Finance,  EDHEC Business School

This strategy ultimately collapsed in December 2008 in what financial experts are calling one of the most detrimental Ponzi schemes in history. Many large and otherwise sophisticated bankers, hedge funds, and funds of funds have been hit by his alleged fraud. In this paper, we review some of the red flags that any operational due diligence and quantitative analysis should have identified as a concern before investing. We highlight some of the salient operational features common to best-of-breed hedge funds, features that were clearly missing from Madoff's operations.

Type: Position paper
Date: le 16/02/2009
Research Cluster : Finance

See Also

EDHEC career support at distance: continuous follow-up and a highly active network
News
- 05-06-2020
After fully digitalising its services, the EDHEC Student Career Centre has been...
How I got my dream internships
News
- 02-06-2020
I originally wanted to be a footballer. I daydreamed about training with the top...
« EDHEC, the best experience of my life so far »
News
- 29-05-2020
WHAT IS YOUR EDUCATIONAL BACKGROUND PRIOR TO EDHEC? Prior to EDHEC, I pursued a...
Meet Valentin Grinner, Pre-Master student
News
- 28-05-2020
Valentin Grinner “I’ve started a MOOC to learn web development” Valentin, 20, is...