Speaking of Bernie Madoff, there's something I don't get. What kind of reports was he providing to his clients? Based on my limited experience with money managers, I just don't see how Madoff could have kept his scam going for any length of time.
Before she met me, Blair entrusted money with an investment manager who opened a brokerage account and traded on Blair's behalf. As with any brokerage account, we get trade confirmations, monthly statements and year-end summaries (which include tax documents). Years ago I used to help out my father, who was an accountant, with the paperwork for some of his clients. I recall a couple who similarly had money managed by professionals. They also received all the usual paperwork from their money managers.
In these cases, it would be impossible for the money managers to falsify returns. If an account went down, you can't simply say it went up; the trail of statements and confirmations wouldn't support it. You just couldn't falsify the returns with any kind of expectation that none of your clients would look at the ticker symbols and history and figure out that something is wrong.
So how did Bernie do it?
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