<TABLE cellSpacing=0 cellPadding=0 width="100%" border=0><TBODY><TR>Where did all of the $72b go?
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<!-- START OF : div id="storytext"--><!-- more than 4 paragraphs -->NEW YORK: - It has become the biggest mystery to emerge from the Bernard Madoff scandal: Where did the US$50 billion (S$72 billion) go? Financial experts have several theories on how Madoff 'made off' with the money:
He lost a bundle in bad investments
Madoff said he 'personally traded and lost money for institutional clients', and that it was all his fault. That suggested he might have blown his investors' money through a failed trading strategy.
He paid some of the money out to investors
Madoff's scheme was partly undone by the year's financial meltdown. Madoff said fearful investors were clamouring for US$7 billion in redemptions. These investors might have taken some of those purported Madoff profits off the table. It was unclear how much of that US$7 billion Madoff paid out to investors, but when things came crashing down, just US$200 million to US$300 million was left in the pot.
Stashed cash in foreign banks and spent some on his lavish lifestyle
Madoff had multiple homes and yachts and was a member of some of America's most prestigious country clubs. His three homes - a Manhattan penthouse, a beachfront mansion in the Hamptons and a home in Palm Beach, Florida - together had a market value of more than US$30 million.
He may simply have inflated his claim of US$50 billion in losses
'He has plenty of houses and yachts, but not certainly enough to account for all this money,' said Professor Aswath Damodaran at New York University. 'It is tough to really lose 100 per cent.' ASSOCIATED PRESS
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<!-- START OF : div id="storytext"--><!-- more than 4 paragraphs -->NEW YORK: - It has become the biggest mystery to emerge from the Bernard Madoff scandal: Where did the US$50 billion (S$72 billion) go? Financial experts have several theories on how Madoff 'made off' with the money:
He lost a bundle in bad investments
Madoff said he 'personally traded and lost money for institutional clients', and that it was all his fault. That suggested he might have blown his investors' money through a failed trading strategy.
He paid some of the money out to investors
Madoff's scheme was partly undone by the year's financial meltdown. Madoff said fearful investors were clamouring for US$7 billion in redemptions. These investors might have taken some of those purported Madoff profits off the table. It was unclear how much of that US$7 billion Madoff paid out to investors, but when things came crashing down, just US$200 million to US$300 million was left in the pot.
Stashed cash in foreign banks and spent some on his lavish lifestyle
Madoff had multiple homes and yachts and was a member of some of America's most prestigious country clubs. His three homes - a Manhattan penthouse, a beachfront mansion in the Hamptons and a home in Palm Beach, Florida - together had a market value of more than US$30 million.
He may simply have inflated his claim of US$50 billion in losses
'He has plenty of houses and yachts, but not certainly enough to account for all this money,' said Professor Aswath Damodaran at New York University. 'It is tough to really lose 100 per cent.' ASSOCIATED PRESS
