Altfest News
‘How Do I Know You’re Not Madoff?’
Article
Here’s how to build trust when prospective clients question the credibility of you and your firm.
We are just about far enough beyond America’s most recent major Ponzi scheme to wonder if there are people who aren’t aware of the scheme at all. But nearly two decades later, being prepared to answer for money manager Bernard Madoff’s sordid tale still remains important for all financial advisers. I was recently reminded of this when a client and professional peer asked me, “How do I know you’re not Madoff?”
First, a Brief Recap
In 2008, Madoff, former chairman of the Nasdaq Stock Market, was charged with running a longstanding Ponzi scheme after his two sons turned him in. Both sons worked for their dad’s money management company, on another floor, and claimed they knew nothing about the years-long fraud until then. After duping wealthy people worldwide, including a few celebrities, Madoff had nowhere to hide. In 2009, he pleaded guilty to 11 felony charges, including securities fraud, wire fraud, mail fraud and money laundering.
Madoff was caught when he could no longer “pay clients” their requested redemptions — not even by taking in money from newer customers. He was convicted in 2009 and sentenced at age 71 to the maximum penalty of 150 years in prison. His attempts at gaining a presidential pardon and early release all failed.
Read more: ‘How Do I Know You’re Not Madoff?’ – Rethinking65
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Karen C. Altfest, CFP, Ph.D
Karen helps many of the firm’s clients on a variety of investment and financial planning issues, and specializes in helping women clients and widows. Karen’s Financially Savvy Woman® programs, including the Women’s Financial $pa®, are popular with clients. Her focus is to educate and empower women.
Karen is frequently a speaker on the subject of women and money, and conducts educational seminars for recent widows and people looking to retire. Karen is a graduate of McGill University in Montreal, holds BA and MA degrees from Hunter College, and holds the CFP® designation. Karen received her Ph.D. in history from the Graduate Center of the City University of New York (CUNY).
She was the Co-Director of the Financial Planning and Investments Program at The New School in New York City and the Coordinator of the Financial Planning program, a professional program for financial planners, which she originated at Pace University in White Plains, N.Y.