Madoff’s Ponzi investment fraud: a social capital analysis
Abstract
Purpose
The social network analysis of criminal networks at both the ego and socio-centric level is well established. This purpose of this study is to expand this literature with a social capital analysis of a criminal network. The focus of the analysis will be the recent egregious investment fraud of Bernard L. Madoff Investment Securities (BLMIS).
Design/methodology/approach
This research involves a case study of the BLMIS financial fraud. The article uses a social capital theoretical lens, with archival sources taken from the court records of Madoff v. NY to include victim impact statements and the defendant’s Plea Allocution.
Findings
Financial crime literature can be expanded with a social capital analysis which facilitates a socio-economic analysis of ego-centric criminal networks.
Research limitations/implications
Each financial crime is of its time; however, there are recurring socio-economic network characteristics that could be applied to develop an understanding of criminal networks.
Practical implications
Any understanding of financial crime, including contemporary instances of criminal innovation, such as cyber-crime, can be enhanced with a social capital analysis of criminal networks.
Originality/value
A social capital analysis of financial crime draws attention to “human factors” in criminal networks that are integral to this form of crime.
Keywords
Citation
Manning, P. (2018), "Madoff’s Ponzi investment fraud: a social capital analysis", Journal of Financial Crime, Vol. 25 No. 2, pp. 320-336. https://doi.org/10.1108/JFC-06-2017-0057
Publisher
:Emerald Publishing Limited
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