The fraudsters will always be back for another innings

The following words by JK Galbraith should be read by every aggrieved Allen Stanford investor. "To the economist, embezzlement is the most interesting of crimes. Alone among the various forms of larceny, it has a time parameter. Weeks, months or years may elapse between the commission of the crime and its discovery. This is a period when the embezzler has his gain, and the man who has been embezzled feels no loss. There is a net increase in psychic welfare. At any given time, there exists an inventory of undiscovered embezzlement in, or more precisely not in, the country's banks and businesses.

"This inventory – perhaps it should be called the bezzle – varies in size with the business cycle. In good times, people are relaxed, trusting, and money is plentiful. And even though money is plentiful, there are always many people who need more. Under these circumstances, the rate of embezzlement grows. The rate of discovery falls off, and the bezzle increases sharply. In a depression all this is reversed. Audits are penetrating. Commercial morality is enormously improved. The bezzle shrinks."

Stanford, the billionaire playboy fraudster is beginning a probable life sentence after being found guilty of running a $7 billion (£4.4bn) Ponzi scheme. He has supposedly been beaten by another inmate while awaiting trial, and is suffering from amnesia. The English Cricket Board chairman, Giles Clarke, must be praying that everyone else is too.

The ECB's deal with Stanford to stage Twenty20 cricket matches looked extraordinary back then. Who was this guy? Neither Mr Clarke nor anyone else at Lord's bothered to ask. He was rich. End of questions.

It's not just the cricket authorities that were wowed by Stanford's rented helicopters. His already wealthy investors believed that they were getting something no one else could: an unregulated offshore fund outside of the reach of those beastly governments they so firmly despise – until they decide they need compensation.

They were in a certificate of deposit, a supposedly risk-free investment that also generated spectacular returns. The court found that Stanford offered "improbable and unsubstantiated high interest rates". Behind every successful fraudster are a bunch of investors, in this case very rich people who felt entitled to more than mere mortals can attain. Greedy folk. Sitting ducks for Stanford.

After every major fraud case, there's an assumption that this disaster must not be allowed to happen again. There's a push for the sort of fresh regulation very rich people always fight against. And lawmakers put on stern faces.

All that will really happen is that there will be a pause, then another boom, then another Stanford. The bezzle has gone away, but temporarily. It will be back.