What was Bernie Madoff thinking?

“It takes an extraordinarily heartless conman to swindle a survivor of Auschwitz and Buchenwald and Nobel Peace Prize winner out of all his charitable funds.” Wrote James Bone in the Times Online.

“Yet that is exactly what Bernard “Bernie” Madoff is alleged to have done to Elie Wiesel, the author of the Holocaust classic Night and a friend from the Jewish community in south Florida.

According to the Times Online article, “The Elie Wiesel Foundation for Humanity now admits that it invested $15.2 million (£10.1 million) with Mr Madoff that represented “substantially all of the foundation’s assets.” The charity of the Nobel laureate, in New York, will have to raise new funds if it is to maintain its two centers in Israel that help Ethiopian Jews and Darfuri refugees and continue its other work.”

Perhaps the person who lost the most by trusting Bernie Madoff is 95 year old Carl J. Shapiro, who has been a personal friend to Madoff for nearly 50 years. In addition to losing 500 million dollars in the relationship, Shapiro at 95 is confronted with the reality that someone he thought of as “a son” did this to him.

“All I can say is that this is an awful, awful time for us,” wife Ruth Shapiro told a reporter from The New York Times.

Mr. Shapiro started his fortune making women’s clothing company Kay Windsor Inc, in 1939. He sold the business to Vanity Fair Corp in 1971; it was one of the largest clothing manufacturers in America. Mr. Shapiro was reportedly introduced to Madoff by his own his son-in-law, Robert Jaffe. Following the introduction, Mr. Shapiro invested in Madoff’s company when it launched in 1960.

Mr. Shapiro and his wife set up their charitable foundation the following year, in 1961, and over the decades have been big donors to the Boston Museum of Fine Arts, the Boston Symphony Orchestra, Brandeis University in Boston which Mr Madoff also supported through his own charitable foundation, the Beth Israel Deaconess Medical Center and the Brigham and Women’s Hospital where the Carl J. and Ruth Shapiro Cardiovascular Center opened this spring.

Building work is due to start next week at Boston Medical Center on the Shapiro Ambulatory Care Center, a nine-floor, $135 million facility paid for in part with $15 million from the family foundation, according to the New York Times.

In March, the foundation pledged $27 million to DanaFarber/Brigham and Women’s Cancer Center in Boston. Brandeis has received $22 million from the Shapiros to build the campus centre building.

Mr. Shapiro issued a statement saying that he had been “stunned and saddened to learn about the allegations” against Madoff. He said the losses would have “an impact on our family as well as our family foundation.” and that watching the arrest of Madoff on television was “a knife in the heart.”

Bernie Madoff cheated a 95 year old man, a Holocaust survivor and many others. If you are like me, you are wondering, “What was he thinking?” Personally, I don’t find the “without conscience” explanation of this kind of behavior very satisfying. You can’t convince me that Madoff was without thoughts as he created false documents and told frank lies to people. He had to have been thinking something.

Just what was Madoff thinking? He hasn’t said yet, but I can give you an educated guess based on the seminal work of prison psychologist Glenn Walters, Ph.D. I also highly recommend that students, professionals and the public read his books, The Criminal Lifestyle and Criminal Belief Systems.

Dr. Walters began his work understanding criminal lifestyles at the same time Dr. Hare set out to define psychopathy. The lifestyle criminal that Dr. Walters describes is essentially a psychopath/sociopath. His Postulate #1 reads:

“Crime can be understood as a lifestyle characterized by a global sense of irresponsibility, self-indulgent interests, an intrusive approach to interpersonal relationships and chronic violation of social rules, laws and mores.”

Dr. Walters answers our “Just what was he thinking” question in Postulates #5 and 6:
“There is a distinctive thinking style that derives from the lifestyle criminal’s decision to engage in delinquent and criminal acts (5).

The content and process of criminologic thought are reflected in eight primary cognitive patterns (6).”

I will explain these eight patterns and you will see that although Dr. Walters studies criminality these patterns pertain to antisocial conduct in general. Note that sociopaths try to fool both themselves and others with these disordered thinking patterns.

Cognitive pattern #1 Molification: Molification refers to the thoughts sociopaths use to lay blame for their irresponsible antisocial behavior outside themselves. According to sociologists Sykes and Matza these justifications can be grouped into five major “neutralization techniques”:

1. Denial of responsibility. Sociopaths deny responsibility by claiming their behaviors are accidental or due to forces beyond their control. Perhaps Madoff was thinking “I am under pressure to deliver what people asked for.” i.e. “The investors made me do it.”
2. Denial of injury. No one got hurt, and therefore there’s no harm. “All these people are rich anyway.” Madoff reportedly did not take a client who had less than a million dollars to invest.
3. Denial of the victim. Sometimes sociopaths admit that their actions cause harm. In these cases they can justify their behavior by denying the victim. In this case Madoff was thinking “The rich deserve whatever they get.”
4. Condemnation of the condemners. Instead of focusing on their own actions, sociopaths focus on the motivations or behaviors of the people who disapprove of them. So Madoff was likely thinking “How do you think these rich people got their money anyway?” or “Everyone on Wall Street is just as corrupt as I am.”
5. Appeal to higher loyalties. Sociopaths claim that their behavior is consistent with the moral obligations to their group. Using this line of reasoning, Madoff would say, “I stole to provide for my family.”

Cognitive Pattern #2 Cut-off: Cut-off refers to the techniques sociopaths use to avoid thinking about negative consequences. They cut themselves off from any worry or guilt they might be inclined to feel. In this pattern Madoff who is 70 now was likely thinking, “I’ll be dead before they figure out what I’ve done.”

Cognitive Pattern #3 Entitlement: According to Dr. Walters most sociopaths believe that laws and social rules are necessary. “However they also believe that they are somehow personally exempt from the rules that govern the rest of us. This sense of entitlement is what provides the (sociopath) with permission to violate societal laws and the personal rights of others.” He is, after all the great, lovable, charming and exceedingly brilliant Bernie Madoff!

Cognitive Pattern #4 Power Orientation: There are those who are strong and those who are weak. The weak are prey for the taking. “If a person is stupid enough to fall for my con then he doesn’t deserve his money anyway.”

Cognitive Pattern#5 Sentimentality: Sentimentality involves an attempt by the sociopath to present himself in as favorable a light as possible. How much money did Madoff give to charity so that other people would see him as kind and generous?

Cognitive Pattern#6 Superoptimism: The sociopath’s tendency to be extremely optimistic and self-confident about not getting caught is referred to as superoptimism. According to Walters, “Experience has taught (sociopaths) that the many crimes they get away with greatly outnumber the crimes for which they have been caught.” The SEC did investigate Madoff 10 years ago as he continued his fraud. I think beating that investigation likely made him feel even more invincible.

Cognitive Pattern #7 Cognitive Indolence (laziness): According to Walters, “Like water running downhill, the (sociopath’s) thinking takes the path of least resistance.” Why should Madoff do all that investing? It’s too much like work, when you can simply take money from one guy and give it to another. It is much more fun to schmooze and play golf.

Cognitive Pattern #8 Discontinuity: The sociopath fails to follow through on commitments, carry out intentions, or remain focused on goals over time. Discontinuity is reflected by the fact that Madoff at 70 will likely spend the rest of his life in prison. Though I think so-called successful psychopaths have lives marked by less discontinuity than the unsuccessful ones.

If you have examples of sociopaths using these thinking styles to justify outrageous acts, please share them in comments. Remember since the inner world of sociopaths is relatively shallow, they are most concerned with convincing others to use these perverted thought processes to make sense of their behavior. It is relatively easy for them to convince themselves that their antisocial behavior makes sense and is fully justified.