Psychology of Criminal Behavior: Bernie Madoff Case Study

Running Head: PSYCHOLOGY
Topic- Psychology of criminal behavior
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2PSYCHOLOGY
PART 1
The paper is based on the psychology of criminal behavior. The report is based on the
case study of Bernie Madoff, the man behind the most notorious financial crime in history, the
mastermind of the Ponzi scheme deception (Andrews & Bonta, 2014). Based on his life history
the book ‘Betrayal-the life and lies of Bernie Madoff’ by Andrew Kirtzman is considered for
critical evaluation of the paper. The book provides an in-depth and personal insight in to the life
of the biggest financial fraud architect. Bernie is been right called as the ‘king of swindlers’ and
he victimized a number of corporations, celebrities and common people who invested all their
life savings trusted that man (Azim & Azam, 2016). The book provides a thrilled experience of a
criminal life that is disturbingly true.
The main purpose of the paper is to provide the reader the true-life coverage of Bernie
Madoff and his criminal behavior. How he used his criminal mindset under the mask of a true
gentleman is surely a topic of consideration in psychology, especially in criminal psychology.
All facts and hypes of Madoff’s life are critically studied in order to have the true essence of
criminal behavior.
The paper covers all possible areas needed to evaluate a psychology paper. It has its
background of the topic and description of the crimes. A brief summary of the financial Ponzi
crime case of Bernie Madoff is already provided above, and the description section will include
summary of index crime, apt terminologies and concepts in regard to psychology (Bartol &
Bartol, 2014). Chronological order of criminal events is mentioned with the main reason of
committing such crime. Criminal judicial system in context of notorious crime by Bernie Madoff
is also highlighted in this section.

3PSYCHOLOGY
DESCRIPTION OF CRIME
Index crime is basically the eight crimes designed by FBI. They include offences in terms
of willful homicide, robbery, forceful rape, burglary, arson, motor vehicle theft, aggravated
assault and larceny over $50. In this regard the crime committed by Bernie Madoff is clearly a
fraud scam of multi-billions of dollars and comes under larceny index crime (Hornuf & Haas,
2014). He himself was the initiator of his fraud triangle of pressure, opportunity and
rationalization. The panic redemption of the financial crash of 1987 pressurized Bernie to borrow
from new investor capital in order to pay the existing investors and show falsified big returns
instead. The sell-off associates of the crash and slow return on recovery are the main causes
behind his ultimate motive of fraud (Lewis, 2015). He also got the opportunity to cheat as
nobody doubted or ever questioned his intensions. A number of large investment banks and
financial institutions just wanted to invest in his company and Madoff also refused to disclose his
return policies (Kirtzman, 2009). False financial statements show constant growth and high
returns and Madoff used this trick to investors and easily fooled them. The rationalization that
everyone runs after money and are greedy is another aspect of increasing the Ponzi scheme
(Lewis, 2015). He many times put warning signs to the investors mentioning that investments
could be risky and could result in losses but no one was ready to miss this opportunity of easy
return. All these lead to the biggest financial crime of 2008.
The major stock and securities fraud of the Madoff Investment scandal show the dark side of the
most honored man of NASDAQ and Wall Street firm. After the multi-billion-dollar fraud caused
by the Ponzi scam Bernie Madoff himself allegedly confessed his guilt to his employees and
mentioned that the asset management of the firm is an extended version of a large Ponzi scam
and nothing else. No one believed his confession at the very first time as the man in their mind is