Bernie Madoff — the con, the criminal, the fraud, and the scum of the corporate establishment. These were the titles given to this corrupt financier, but above all, he was said to simply be a “bad egg” in a basket of well-intentioned entrepreneurs and “job creators.”
However, despite these claims, Madoff’s case is not unique. Madoff’s real crime was that he stepped outside the circle of appropriate corporate conduct, whose edge tends to gravitate farther and farther away from lawfulness as income rises. The reality of wealth privilege within the institutions that are publicly seen as ‘just’ is a causality of a system that rewards excess. Most shocking, however, is how the personal endeavors of these individuals clash with their fraudulent actions. Madoff, perhaps, is the epitome of such a phenomenon. Although stealing billions of dollars, he was also a devoted philanthropist. His largest beneficiary was the Picower Foundation, which allocated the funds to organizations such the Boy Scouts of America and the Children’s Aid Society. NY Times reports the funds as:
In total, $958 million was donated to the Picower Foundation.
Other charities were involved, and were almost entirely dependent on Madofff’s funds. As reported by the NY Times, some of them included:
- $145 million to the Carl & Ruth Shapiro Family Foundation
- $20 million to Tufts University
- $18 million to the Jewish Community Foundation of Los Angeles
- $19 million to the Madoff Family Foundation
- $90 million to the Hadassah, the Women’s Zionist Organization
- $100 – $125 million to Yeshiva University
These are incredible amounts of money, so abuse comes to no surprise; but is it not an anomaly that the worst white-collar criminal in history was also one of the ‘greatest’ philanthropists, by modern standards? Acting as a perverse indulgence, charity might not be as chivalrous of an act as socially understood. Seen as a mechanism of redemption, this behavior is typical in this category of criminal activity. Bernard Ebbers, convicted in 2005 of similar crimes, showed the same phenomenon, having donated over $100 million dollars to charity over the course of ten years. Corporations are no exception; Enron was also a known giver to charity,
Enron CEO Kenneth Lay exemplified the company’s philanthropy, endowing several professorships at the University of Houston and Rice University, while the company itself was known for its generous gifts to arts groups, scholarship funds, and the Texas Medical Center.
Such behavior, interestingly enough, correlates with the religious attitude seen when the Catholic Church held immense power in Europe during the Middle Ages. In an effort to ‘save’ those in Purgatory, having commited sins on Earth, priests charged individuals sums of money for indulgences, or remissions, to free or limit the time their loved ones would be trapped in this supernatural lingo. Priests, making huge individual profits, attempted to justify their accumulations through Church-sanctioned actions. In effect, they stole with one hand and ‘saved’ with the other.
In a modern twist, corporate crime is looking for that same metaphysical ‘salvation,’ and they certainly found it in charity. Functioning as an egoist drive, this behavior only highlights the disparity of behavior within certain classes of the social strata. Little rationality can be viewed amongst those that accumulate such large reserves of finance power, as they scramble to find redemption in a sea of fraud and narcissism. It is this crude revelation that illustrates the paradox of corporate conduct — as long as you appear charitable, what is done behind closed doors is forgivable. Or so the twisted mindset goes.
More info on the “Paradox of Fraud and Philanthropy”