Normative ethics refers to the attempt to understand or figure out what individuals need to do or whether their moral character is reasonable. Normative ethical systems are divided into three categories which include; teleological ethics, virtue ethics and deontological ethics. Deontological and teleological ethics are considered as action based or deontic theories of morals since they exclusively focus on the actions that are performed by an individual. If someone’s actions are morally judged, this is termed as consequentialist or utilitarianism or teleological theory while in deontological ethical theory, someone’s actions are evaluated morally right based on how good and perfect they agree to some set of obligations. System that is based on virtue tends to focus less on the rules and regulations individuals ought to follow and instead emphasis on assisting persons to build up good character qualities like love, kindness and self control.
This paper will look into the issues concerning Bernie Madoff who has been involved in the Ponzi scheme on the basis on utilitarianism and deontological ethics. A Ponzi scheme refers to a deceptive operation and it came into being in the early 1900s and is one of the biggest deceptive in the Wall Street history. This scheme was named after a person called Charles Ponzi who was dishonorable for using the unreliable investment methods. Recent involvement of Bernard Madoff in the Ponzi scheme clearly shows that the scheme is still functioning properly. Bernard Madoff is an American criminal who has been a chairman and financier of the NASDAQ stock exchange.
Bernard Madoff was arrested on 11 December 2008 by the federal authorities who were alerted by his sons. On 12 March 2009, he pled guilty to eleven crimes and agreed to have been working in what has been known to be the greatest investor scam ever committed by a person. He agreed that his form of wealth management business had deceived thousands of investors of many billions of dollars. Madoff said that he started the Ponzi scheme during the early 1990s but the federal investigators knew that he started the fraud in the early 1980s and the kind of investment operation was not legal. The total amount lost from the customer accounts comprising of the fabricated gains, was approximately 65 billion dollars.
Madoff was sentenced to 150 years in jail on 29 June 2009 with compensation of 170 billion dollars. He confessed that his firm had liabilities of about 50 billion dollars but the prosecutors approximated the amount of scam to be 64.8 billion dollars depending on the total amounts that was in Madoff’s accounts with 4,800 customers as of 30 November 2008.
After Madoff was arrested on 28 December by the federal authorities who were alerted by his sons who Madoff had told that his firm was a great Ponzi scheme, he was released on the same day. He was released after posting 10 million dollars bail. Madoff and his wife gave out their passports and he was restricted from traveling, a 7 p.m at his house and electronic scrutinizing as a condition of the bail. Madoff had only two co-signers for the 10 million dollars he gave and those were his wife and brother instead of the actual four who are required. A judge permitted him free bail though he ordered him to confine in his mansion.
After he pleaded guilty to all the eleven felonies on 12 March 2009, there was no appeal accord between him and the government. He plainly pleaded culpable and signed a waiver of condemnation. He was then sentenced to 150 years in the prison which is the maximum number of years allowed for someone to be in prison. In addition there was a compulsory compensation and fines of twice the total gain or loss obtained from the offences. Therefore, that’s means that Madoff will have to refund or pay 170 billion dollars in compensation.
Madoff’s scheme case has remained to be one of the hardest cases to go through. This is because most of the time, white collar cases start with a quiet, slow, behind the scenes investigation then later comes the chain of arrangements with the subordinate employees who are forced by the prosecutors to say all the information concerning their boss or superiors. The prosecutor then continues and eventually, the cessation comes in which the ringmaster is heaved into the courts in chains. This type of crime is different from other types of crime because it involve persons who are of high class or status and highly respectable in the course of their profession. Some of the crimes associated with white collar individuals include; bribery, fraud, embezzlement, computer crime, insider trading, forgery and identity theft.
The importance of the US criminal justice system is to minimize crime through bringing more crimes to justice and win the confidence and trust of the public of being fair and the system’s ability to deliver to the law abiding citizen. Such a vision is good for any country. However, looking at the period Madoff has been spending in his apartment on free bond; justice does not prevail in this situation. Bearing in mind that Madoff had engaged in the Ponzi scheme and thousands of people lost their money, he should have been confined in the jail as he awaited his trial and not in his apartment. This is because according to deontological theories in normative ethics, someone’s actions are evaluated morally right based on how well and perfect they agree to some set of obligations. On the other hand, in utilitarianism theory, the outcome of a certain action is based on the worth of his or her morals. Having analyzed Madoff’s morals or character the outcome was deception which is a great crime which required him to be imprisoned immediately but instead he had wait in his apartment before the final judgment. That was not fair and did not successfully fulfill the US vision on criminal justice system which is to minimize crime by bringing more crime to justice.
Therefore, according to how white collar crimes are judged, the concept does not conform to the deontological theory. Madoff’s case reflects white collar crime and for him to have been confined in his apartment for more than one year as he awaited his trail was not fair and just. This is because anyone who contravenes the law is supposed to be jailed and Madoff had contravened the law. Though he has now been sentenced, apologizing to his clients was not of any benefit after they had lost lots of billion dollars. Madoff has left a heritage of shame.