Bernie Madoff’s Message To MBAs

University of Maryland’s Smith School of Business


Madoff hasn’t been an easy man to reach since being incarcerated. The Bureau of Prisons, for one, restricts his contact with the outside world by pre-approving anyone he emails in advance. After he began teaching at the University of Maryland in 2014, Weber received what he describes as an “extraordinary email,” an automated request to his school account to correspond from none other than “Inmate Madoff, Bernard L.” This sparked a long and regular string of communiqués between the two. “He was obviously keeping track of what I was doing,” Weber jokes.

Initially, Weber planned to carve out a guest teaching spot for Madoff, who agreed to take on the role. However, Weber encountered concerns about security with videotaping his lectures. This was then followed by nearly two years of foot-dragging by the Bureau of Prisons, potentially out of fear that Madoff might somehow profit from the venture. Despite this, Weber still found a way to get him involved.

To start, Madoff actually picked out the textbook used by the online MBA class. How did Weber get that one through? Simple: He enlisted the help of the textbook publishers, who sent review editions of selected books to Madoff. After reading all of the books, he settled on the 4th edition of Joe Wells’ Principles of Fraud Examination from Wiley Publishing. The choice didn’t surprise Weber, who notes that Wells is a former FBI agent, CPA, PhD, and a past chairman of the Association of Certified Fraud Examiners.


Madoff also acts as a sounding board for students in Weber’s MBA fraud classes. Sometimes, online students will pose questions to Madoff, who’ll email back answers for Weber to share. For executive MBAs, Madoff will compose an email for incoming students and Weber will make a photocopy of it for each of the students. Earlier this year, Weber’s online students were discussing the concept of power and how it can be wielded over others. At the same time, a newly-released book claimed that Madoff had cornered the market for hot chocolate, considered the most valuable commodity at his prison.

Seizing on this, students inquired whether the news was true and (if so) how it related to power. After vehemently denying the book’s claims, he went into depth about the various forms of power that can be used to dictate or influence behavior in an organization

“So we had this whole conversation about these various concepts of power and I was able to share it with the students,” Weber says. “Bernie has a lot of time on his hand to think about these things. To have someone like that provide insights about ethics and fraud is extraordinary. It’s extraordinary for me and I imagine it is extraordinary for the students.”


So what does Madoff have to say about the risk of fraud for MBAs? In March, Weber posed this very question to Madoff in lieu of his interview with Poets&Quants. “In my mind, MBAs are probably the greatest population at risk for fraud or unethical behavior, because earnings pressure is so high,” Weber wrote to Madoff. “Do you have any thoughts on this? Are there things that you think could be added to graduate (or undergraduate) curriculum that could help prevent fraud, or make executives more resilient or resistant to a bad decision impulse? Is there any message or thought that you would like to provide to these executives (or future executives?)”

Madoff’s response, delivered an hour later, is stunningly candid.


You are providing a great service to your students. I for one am a terrific example of what you are talking about. For more than 75 % of my career I served on regulatory committees and as consultants to the regulators worldwide. If I became aware of anything it is how LACKING the understanding of both the accounting and legal profession is regarding the very industry they are trying to monitor and regulate. Quite frankly they are ill equipped to perform their obligations. This is not to in any way imply that their own moral compass is at fault nor I am I in any way rationalizing or excusing my own and the other industry population behavior.  David I was surrounded by every level of investor and business executive and I am convinced that FRAUD is rampant at almost every level. I wish I had the knowledge to somehow change this. I think that the often quoted remark of Michael Douglas in the movie Wall Street that” GREED IS GOOD”. Once again this behavior is not limited to the Business world. Look at our GOVERNMENT. I know I sound bitter. Please excuse my own embarrassment and REMORSE.




Indeed, Madoff’s response touches on several key motifs in Weber’s courses. Weber harkens back to the importance of due diligence as the cornerstone of curbing fraud. “Clients don’t always tell you the truth,” Weber laments. “The only way you can be comfortable that the client is telling you something that is true is through verification.” Going hand-in-hand with that is resisting the temptation to make assumptions. “You can be affluent, engaging, charismatic —all the things that Bernie is and was. If a single person anywhere along that chain of events had done a verification, the Ponzi Scheme would’ve collapsed years earlier.”

While Madoff preaches education and conscientiousness these days, some are skeptical that he is a changed man. Over the past decade, it has become fashionable to dub some business executives as psychopaths: a-moral, unfeeling self-servers who climb the corporate ladder thanks to being ruthless, manipulative, and charismatic. In some pop psychology corners, Madoff is lumped into the psychopath category. While Weber admits to being neither a trained psychologist nor a Madoff apologist, he has a definite opinion on the matter.

“I don’t think he is,” Weber says. “The reason is that he is showing remorse. Psychopaths could pretend to show remorse. That’s how they’re able to get ahead — they’re able to mirror the feelings of others. In his circumstance, where he has a 150-year prison sentence, why would he have to mirror anything? He’s not in a place where he needs to curry favor with anyone. I take, to a certain degree, that certain things he talks about, including his own feelings, are somewhat legitimate. He’s not looking for our approbation or approval.”

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