Mini Madoff

DEFINITION of 'Mini Madoff'

Financial con men that are accused of or have commited crimes similar to those of Bernard Madoff. Mini Madoffs tend to orchestrate ponzi or pyramid schemes that are similar in nature to Bernard Madoff's, but are smaller in size and notoriety.

BREAKING DOWN 'Mini Madoff'

In a ponzi scheme, like Bernard Madoff's, investors are promised unusually high returns and early investors receive these returns from the money invested by new investors. The cycle of illegitimate returns can continue until the pool of investors fails to grow. With all schemes of this nature, eventually the infusion of new money dries up and the hoax unravels.

RELATED TERMS
  1. Ponzi Mania

    The seemingly sudden recognition of Ponzi schemes following the ...
  2. Bernard Madoff

    The former chairman of the Nasdaq and founder of the market-making ...
  3. Ponzimonium

    After Bernard Madoff's $65 billion Ponzi scheme was revealed, ...
  4. Ponzi Scheme

    A fraudulent investing scam promising high rates of return with ...
  5. White-Collar Crime

    A non-violent crime that is committed by someone, typically for ...
  6. Option Income Fund

    A type of mutual fund with the goal to generate current income ...
Related Articles
  1. Financial Advisor

    ABC's Madoff Miniseries Explores His Charm, Smarm

    An ABC miniseries on Ponzi scheme king Bernie Madoff gets inside the head of a man who was, in fact, not too big to fail.
  2. Markets

    When Will DoJ Release The Madoff Relief Fund?

    The Department of Justice is sitting on a $4 billion relief fund for victims of Ponzi Scheme artist Bernie Madoff. What's taking so long to pay it off?
  3. Financial Advisor

    The 5 Worst Financial Advisor Scammers of All Time

    A look back at history's five worst financial scams.
  4. Financial Advisor

    6 Ways to Avoid an Investment Ponzi Scheme

    Investments that promise high returns with little risk are everyone's dream – but if they could also be a Ponzi scheme. Here's how to protect yourself.
  5. ETFs & Mutual Funds

    The 3 Biggest Hedge Fund Scandals

    Learn about major scandals at hedge funds including the Madoff investment scandal and insider trading cases at SAC Capital and the Galleon Group.
  6. Trading

    How To Avoid Falling Prey To The Next Madoff Scam

    Due diligence does work, but the loose reporting standards for hedge funds make extra care and attention necessary.
  7. Financial Advisor

    Are You Sure You Aren't Ponzi Scheme-Susceptible?

    Anyone can be a victim of a Ponzi scheme — even the most financially literate. Here's how to avoid the next Madoff.
  8. ETFs & Mutual Funds

    4 Investment Mistakes That Will Cost You

    Whether you're just starting out or have been investing for years, mistakes happen. But some of them will cost you big and can easily be avoided.
  9. Financial Advisor

    How to Avoid the Top Financial Advisor Scams

    Investors need to be wary of financial advisor scams. Here are the most common and how you can protected yourself.
  10. Investing

    What Is A Ponzi Scheme?

    Protect yourself from scams by learning the structure behind this fraudulent investing scheme.
RELATED FAQS
  1. What are some famous scandals that demonstrate the agency problem?

    Learn more about the agency problem and find a few famous examples. Find out what contributes to these problems and how investors ... Read Answer >>
  2. What is the difference between a Ponzi and a pyramid scheme?

    Pyramid schemes and Ponzi schemes share many similar characteristics in which unsuspecting individuals are fooled by unscrupulous ... Read Answer >>
  3. Do common stock owners have any protections against bankruptcy or fraud?

    Learn about common stock ownership including the standing of holders in the event of bankruptcy or fraud, and familiarize ... Read Answer >>
  4. What are the advantages of using a mini forex account for trading?

    A mini forex trading account involves using a trading lot that is one-tenth the size of the standard lot of 100,000 units. ... Read Answer >>
  5. What is a risk pyramid and why is it important?

    Learn about the risk pyramid and what it is used for; discover why it is important for investors to use the risk pyramid ... Read Answer >>
  6. Who were Bernard Baruch's greatest influencers?

    Find out who influenced philanthropist and financier Bernard Baruch over the years and who spurred him to sell his stocks ... Read Answer >>
Hot Definitions
  1. GBP

    The abbreviation for the British pound sterling, the official currency of the United Kingdom, the British Overseas Territories ...
  2. Diversification

    A risk management technique that mixes a wide variety of investments within a portfolio. The rationale behind this technique ...
  3. European Union - EU

    A group of European countries that participates in the world economy as one economic unit and operates under one official ...
  4. Sell-Off

    The rapid selling of securities, such as stocks, bonds and commodities. The increase in supply leads to a decline in the ...
  5. Brazil, Russia, India And China - BRIC

    An acronym for the economies of Brazil, Russia, India and China combined. It has been speculated that by 2050 these four ...
  6. Brexit

    The Brexit, an abbreviation of "British exit" that mirrors the term Grexit, refers to the possibility of Britain's withdrawal ...
Trading Center