Bernie Madoff was proof that if something is too good to be true, it usually is

While we’re currently poring over Greensill’s demise, we should be looking for the next Greensills and Madoffs, firms that are of doing well but are similarly built on sand or fraud, writes Chris Blackhurst

Madoff’s scheme required a constant supply of new investors to enable him to pay off others (Getty)

The death of Bernie Madoff should draw to an end one of the most tarnished episodes in the recent history of finance.

Except it won’t. Madoff’s passing in a US jail where he was serving 150 years after pleading guilty in 2009 to running a giant “Ponzi” scheme – paying investors with new money coming in from clients, rather than from actual profits – serves as a sharp reminder of the failings of a system intended apparently to prevent such frauds.

Some $170bn flowed through the books of Bernard L Madoff Investment Securities, much of it via the London office, which played a pivotal role in the scam. Almost 5,000 investors lost more than $21bn. When his operation was closed down, less than $1bn remained.