Madoff touted 'advanced technology' to his clients/victims

Bernard Madoff, accused by federal authorities of stealing some $50 billion in an elaborate investment fraud, stressed the use of “advanced technology” and disaster recovery protection in an apparent effort to give clients some peace of mind.

Madoff was arrested last week by the FBI and charged with fraud. The operation has been described as a Ponzi-like scheme that sailed under the eyes of federal and state regulators.  

Madoff fostered a reputation for his firm as a leading edge user of technology. His firm claimed “proprietary automation” that included use of “proprietary smart router” and "proprietary web technology." which was all part of the “industry's most advanced technology.”

Madoff’s firm didn’t just have computers -- it had “sophisticated computers.”

The company,  Bernard L. Madoff Investment Securities LLC, claimed a technology prowess on its Web site that seems, in hindsight, weird. It's all preserved on a Google cache.

For instance, the New York-based firm claimed that its use of “leading edge information processing technology" meant that clients "can choose to communicate their buy and sell orders to the firm's trading room by electronically inputting them or by making a telephone call.” What this seems to be saying is that you could place an order on the Web or by phone.

Madoff claimed “one of the most sophisticated disaster recovery facilities found anywhere in the securities industry.” This “unique on-line facility is tested continuously to ensure that it is prepared to take over the firm's operations if any kind of disaster were to affect the Manhattan office. Members of the firm's staff are rotated through the facility and regularly perform their work from it.” This facility, near LaGuardia Airport, so the firm claimed, was on a different phone system and electric power grid. Your money couldn’t be safer.

Madoff also trademarked a term he called “Time Slicing” – illustrated by the elephants going through the door. Time Slicing “is available over the Internet,” the company said. (Image above is from Google cache of Madoff site.)

All Time Slicing did was allow clients to execute “across the span of an entire day or a specified period, lessening your vulnerability to significant price swings.” It offered, however, no protection against fraud.