Fifty percent return on investment in 45 days, the Bernie Madoff of the day promised his clients in 1920. It was so deviously clever, the sham was given a name, the Ponzi Scheme. The New York Times has a story today about Charles Ponzi and the man who brought him down, his publicist William H. McMasters.
McMasters’ memoir “The Ponzi Story” was recently acquired and catalogued by the John Jay College of Criminal Justice and reveals the details of Ponzi’s undoing by McMasters, and the publicist’s bitterness that he didn’t receive bigger credit in the case. Though McMasters sold the story to the Boston Post for the equivalent of $64,000 in today’s money and the Post went on to win a Pulitzer, he remained unhappy upon finishing the transcript 42 years later. What’s not stated in the article is that McMasters took the best of three options–drop Ponzi as a client and receive nothing, stick with him and destroy his own reputation, or drop a dime on him and put himself in the spotlight.
Too bad Harry Markopolos, the man who had suspicions about Madoff more 10 years ago didn’t blow his whistle in quite the same way.