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A similar issue I have is with the clawbacks themselves. Should the people who didn't have suspicions and/or didn't act on them have the same outcome as those w
by ballenf 8y ago
A similar issue I have is with the clawbacks themselves. Should the people who didn't have suspicions and/or didn't act on them have the same outcome as those who got out early?
Doesn't this perversely incentivize leaving money in questionable investments? Or at least reduce the incentive to do one's own due diligence?
The more people who pull their money, the faster a pyramid scheme collapses. So even a marginal change in the number of withdrawals can make or break such a scheme.
- markbnj 8y agoAs far as I can tell the clawbacks are of profits taken, not principle. Since the profits were fictitious they represent money stolen from downstream victims of the scam. It doesn't really matter that Madoff stole it and then handed it to someone else: it's still stolen money.
- TuringNYC 8y ago>> Doesn't this perversely incentivize leaving money in questionable investments? If anything, it seems to incentivize spending money quickly, because only those with something left were in a position to have it clawed back. It isnt clear from the article, but i dont think claw-backs forced people without anything left to say, take out a loan to pay back what was spent.