Bernard "Bernie" Madoff – who in 2009 was convicted of a Ponzi scheme so egregious that the term should be renamed after him – is being both celebrated and reviled in an ABC biopic miniseries, premiering tonight (8 p.m. ET).

The cast is a delight: The villain is portrayed by Richard Dreyfus, an honor that Madoff does not deserve. Professional charming dude Charles Grodin plays Carl Shapiro, one of the earliest Madoff investors, who said he had previously thought of Madoff as being like a son. Frank Whaley makes a heroic star turn as Harry Markopolos, the badass financial analyst who was the first to sniff out that there was something rotten in the state of Bernard L. Madoff Investment Securities LLC. As Whaley sputters furiously in one scene, slamming papers on a desk. "Do you want to know how he does it? He doesn't."

That line pretty much gets at the heart of Madoff's crime. The former Nasdaq chairman, who was handed a 150-year prison sentence, "only" stole $20 billion; the remainder of the $50-$65 billion (estimates vary) was, as we now know, non-existent – it's simply the figure that Madoff told investors he had made for them.

They're Called 'Confidence' Men for a Reason

People have described Madoff's investors as victims of their own greed and naïveté. Let's put a stop to that at once, as there is nothing behind such snark other than schadenfreude and resentment of the rich. Besides which, a number of non-profits were gorged, and some had their funds wiped out to close to zero, including the Elie Wiesel Foundation for Peace and the global women's charity Hadassah.

Madoff's modus operandi lay in grooming his victims by earning their trust. He created a front of respectability and generosity, wooing investors through his charitable work. He also used his friendship with J. Ezra Merkin, an officer at Manhattan's Fifth Avenue Synagogue, to approach congregants. Targeting the faithful was a work of evil genius. By various accounts, Madoff swindled between $1 billion and $2 billion from its members – in other words, between 5-10% of the entire stolen bounty was from a single house of worship.

Madoff wined and dined potential investors, often initially turning them away. As Madoff's character says in the ABC miniseries: "You wanna know how to get people to trust you with their money? You present it as an exclusive thing. After that, you couldn't stop them from giving you their money if you tried."

A Man of the Collar

Madoff's plausibility to investors lay in a number of factors.

1) His principal, public portfolio appeared to stick to safe investments in blue chip stocks.

2) His returns were high (10-20% per annum) but consistent, and not outlandish. As The Wall Street Journal reported in a now-famous interview with Madoff, from 1992:

...[Madoff] insists the returns were really nothing special, given that the Standard & Poor's 500-stock index generated an average annual return of 16.3% between November 1982 and November 1992. "I would be surprised if anybody thought that matching the S&P over 10 years was anything outstanding," he says.

3) He claimed to be using a collar strategy, also known as a split-strike conversion (see: "Don't Forget Your Protective Collar"). A collar is a way of minimizing risk, whereby the underlying shares are protected by the purchase of an out-of-the money put option (for a great explainer, see: "Invest Like Madoff—Without the Jail Time"). It's totally legit strategy. There's just one problem: He was not using it. The math didn't work. As the aforementioned Harry Markopolos wrote in a scathing 2005 letter to the SEC, Madoff's stated strategy "should not be able to beat the return on US Treasury bills... If this isn't a regulatory dodge, I don't know what is."

"I'm turning this case in because it's the right thing to do"

The SEC had been investigating Madoff and his securities firm on and off since 1999 – a fact that frustrated many after he was finally prosecuted, since it was felt that the biggest damage could have been prevented if the initial investigations had been rigorous enough. Red flags were raised, then lowered. Markopolos was one of the earliest whistleblowers, having filed his first SEC complaint against Madoff in 2000. In his 2005 letter to the SEC, both his earnestness and frustration are evident:

Madoff Securities is the world's largest Ponzi Scheme. In this case there is no SEC reward payment due the whistle-blower so basically I'm turning this case in because it's the right thing to do.

Using what he called a "Mosaic Method," Markopolos noted a number of irregularities: Madoff's firm claimed to be making money even when the S&P was falling – which made no mathematical sense, based on what Madoff claimed he was investing in. The biggest red flag of all, in Markopolos' words, was that Madoff Securities was earning "undisclosed commissions" instead of the standard hedge fund fee (1% of the total plus 20% of the profits).

The bottom line, concluded Markopolos, was that "the investors that pony up the money don't know that BM [Bernie Madoff] is managing their money." Through his own gumshoe work, Markopolos learned that Madoff was applying for huge loans from European banks (seemingly unnecessary if Madoff's returns were as high as he said).

Markopolos' theories, we now know, were borne out. Madoff's firm had been propping up losses by bringing in more and more investors. On Dec. 10, 2008, he broke down and cried in front of his sons, confessing to them that his whole business was a fraud. The next day, his sons turned him in to the authorities, leading to his arrest by the FBI on Dec. 11, 2008. His trial and sentencing in 2009 made him the poster-boy for the world financial crisis as a whole.

His elder son Mark committed suicide on Dec. 11, 2010 two years to the day after he had turned his father in. The other Madoff son, Anthony, died of lymphoma in 2014.

To date, some $11 billion has been allocated for restitution of Madoff's victims.

All told, Madoff-related legal fees have totaled an estimated $1 billion.

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