Don't get Madoff, get even: Bernie Madoff may deserve his 150-year jail sentence – but he wasn't the biggest crook on Wall Street

by Richard Adams

Everyone knew that Bernie Madoff [1] was going down – since he had already pleaded guilty to running a fake investment scheme [2] worth between $65bn and $171bn [3]. So there was none of the drama that accompanied fraud trials like that of Jeffrey Skilling [4], who maintained his innocence even after he was convicted for his part in the collapse of Enron. The only question [5] today was how long inside Madoff would get. His lawyers suggested – in a spirit of optimism only paid advocates could muster – that Madoff deserved just 12 years in jail. The judge gave him the maximum 150 [6]. So, with time off for good behaviour, Bernie will be out in time to celebrate his 146th birthday in 2084.

In other words, barring a judicial miracle, the 71-year-old Madoff will spend the rest of his life behind bars. In terms of discouraging others from selling their souls in return for enjoying 20 years of wealth and prestige, Madoff's sentence is a good thing. And it is tempting to indulge in schadenfreude at Madoff's expense, after he had indulged in riches and privilege at the expense of others. But the worst result of Madoff's life sentence is that he becomes the face of the circa-2008 financial tsunami – and that he doesn't deserve, even if he deserves to rot behind bars.

What Bernie Madoff really needs is company, and lots of it. And not just from those who must surely have helped him [7] – since no-one could carry out such a massive fraud for so many years without substantial assitance. He should have company from the overseers of the fraud perpetrated by Wall Street's most famous names, on a trillion-dollar scale that dwarfs even Madoff's fraud.

Indeed, a 150 year sentence [8] for Madoff verges on the heavy-handed, and not just compared to other crimes (Ted Kaczynski [9], the Unabomber, also pleaded guily and got imprisonment without parole – but he killed people). Skilling, the mastermind behind the house of mirrors that was Enron, received a sentence of only 24 years in jail, and that was after pleading not guilty. (Skilling is still appealing [10] his sentence, although his conviction has been reaffirmed by the US court of appeals.)

So what makes Madoff worse, apart from the size of his fraud? According to the judge who sentenced Madoff, the length partly reflects the fact that no friends, colleagues or family members were willing to give character references for Bernie to the court. But that's hardly a surprise, since they want to be as far away from the whole business as possible. Feel free to speculate in your own mind as to why that might be. And that is the difference between Madoff and Skilling: the Enron chief executive was one of several running the company who were tried and convicted, spreading the blame and the retribution.

But by allowing the blame to fall on Madoff – who made a billion-dollar understatement in court when he referred to his fraud as "an error of judgment" – lets many more people off the hook. When the compilation clips of the 2008 financial crisis [11] news-reel runs in the future, as it surely will, the face of Bernie Madoff alone can't be allowed to personify the scale of the disaster. Madoff profited from it, to be sure. But he was the scavenger who picked over the bones left behind by the crazy-money operations run elsewhere.

Sadly for Bernie Madoff, his fraud was straight forward: he stole money from investors and ran a Ponzi scheme [12]. (His particular genius was not to promise fantastic, overnight profits, as is usually the way. Instead he offered solid long-term returns [13], less likely to attract attention.) But if he'd really been smart he would have got into selling collatoralised debt obligations, credit default swaps, mezzanine level revolving syndicated loans, tulip futures and all the rest. Then, if he'd really got lucky, he'd have got a bailout.