The five big changes the Madoff scandal made to the financial world

The Madoff scandal was an enormous wake-up call, likely to shape the thinking of investors for years to come. Matthew Lynn outlines five of the big, long-term changes we can expect to see.

Not much in the financial markets can ever be stated with any real certainty. But here's one prediction you can take to the bank. Bernard Madoff isn't going to be back in the investment business any time soon. On Monday, a New York court sentenced the world's most accomplished fraudster to 150 years in jail. It is safe to say that he won't ever be released.

That, at least, is some measure of justice. The full scale of Madoff's fraud may never finally be known. At its peak, his firm had $65bn under management. In the court hearings, some allowance was made for redemptions, but it was estimated that between $10bn and $20bn went missing. Since many of his investors came via discreet Swiss private banks, and are unlikely ever to go public with their losses, we may never know exactly how much money disappeared.

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Matthew Lynn

Matthew Lynn is a columnist for Bloomberg, and writes weekly commentary syndicated in papers such as the Daily Telegraph, Die Welt, the Sydney Morning Herald, the South China Morning Post and the Miami Herald. He is also an associate editor of Spectator Business, and a regular contributor to The Spectator. Before that, he worked for the business section of the Sunday Times for ten years. 

He has written books on finance and financial topics, including Bust: Greece, The Euro and The Sovereign Debt Crisis and The Long Depression: The Slump of 2008 to 2031. Matthew is also the author of the Death Force series of military thrillers and the founder of Lume Books, an independent publisher.