An interesting piece of news ended up buried in a flood of other news but I think it’s worth looking at and learning from. Today, all investors of Bernie Madoff who received any payout were ordered to pay it back. This could be very problematic for some investors who received sizable payouts from Madoff.

We can look at this from two perspectives. First, let’s take the victim approach. I’m sure that there were a good amount of people who received money who honestly believed that they were invested in an ethical investment house. They were paid dividends which included an account statement that proved some of the best minds on Wall St. Did you know what a Ponzi Scheme was before Madoff? I didn’t so how would we expect that these people would? They may have been scammed just as those who lost a lot of money.

On the other hand, some of the investors with Bernie Madoff were seasoned investors who didn’t need Madoff’s help. They knew that 20% returns or more are not typical of an investment product and surely knew that something can’t be as it seemed. Some of these people probably knew about Ponzi Schemes and had to suspect that something like this was going on. Greed had to have taken over.

Regardless of your opinion, I haven’t talked to anybody who doesn’t believe that those who lost money to Bernie Madoff shouldn’t get as much of it back as possible. My person opinion is that those who received payouts are holding the money that others lost and it should be returned. You may not agree with me and that’s ok.