[JohnStrange]

People loose millions every year without consequences. It's only considered a crime under certain circumstances and if you don't fulfill the general expectations in terms of behavior, dress codes, legal structures, etc. Maybe this guy just made the mistake of using a way of loosing the money that made him personally liable. He used the wrong form of investment and legal structure.

If he had taken a better lawyer and fund manager, this wouldn't have happened.

[valuearb]

If you tell someone you will invest their money, but your investments lose money for them, that's not a crime.

If you tell someone you will invest their money, but you spend it on yourself, that's a crime.

Can you see the difference?

[JohnStrange]

I can see the difference, but I think in reality these cases are way less clear and the lines are way more blurry. I also wasn't really discussing the legality of his actions, I was rather addressing the way in which some of these people slip on the wrong path. Some of them may be evil, but not all of them are the kind of malign criminals as these media stories portray them.

Since it's holiday season, I'll give a more comprehensive answer with a literature recommendation: Thomas Mann's Confessions of Felix Krull. I'm pretty sure you'll like it if you haven't read it yet. Also relevant would be Gottfried Keller's Kleider machen Leute (clothes make the man), a beautiful love story. Unfortunately it apparently has never been translated into English.

[Radim]

The difference is exactly as OP says: better legal structure, lawyers and accountants. Achieving the same effect by more convoluted (safer) means.

Or what’s your point?

[valuearb]

Right, so you think investing is the same as theft.

That would make Warren Buffett is the biggest thief of all and has apparently stolen $487B from investors. Of course he hasn't spent their money, it's actually invested in hundreds of companies and investors can get their money back any time they want just by calling their broker.

But in your mind, it's the same as if he had stolen it. Because of "lawyers, accountants, and stuff".

[zafka]

A much simpler case is the investment house my mother used shortly after my Father died. While they did not out right steal, they charged very high fees and tried to convince her to move her investments around. Now that she understands what she got into, it will still cost her more than it should to withdraw her money. She trusted them as the salesmen was from her church, and the company had "lutheran" in it's name.

[valuearb]

Charging excessive fees and poorly serving client needs isn't theft.

Saying the Ponzi scheme guy is no different than a sleazy stock broker is massively trivializing his crimes. Sure, what happened to your parents is wrong, but it's far from what he did to his victims.

[zipwitch]

No. At the risk of speaking for someone else, he appears to believe that we live in a society where it is far too easy for individuals with malign motivations to blur the line between managing someone's money and stealing it.

[rhizome]

In this context I'm pretty sure it's all "stealing it." There may have been a guise of managing money, but it was a hoax.

[Radim]

I actually don't, stop being silly.

Where did Warren Buffet lose money unaccountably? Why are you shifting the goal posts, derailing a thread about personal liability for losses to talk about a successful investor?

I think you'll find that the attribute of "intrinsic motivation", which is what your argument boils down to, is not that clear cut (not even to the "fraudster") in reality.

[valuearb]

Warren Buffett "lost" around $200 billion of his investors money during the 2008-2009 financial crisis. Obviously no investor lost a dime unless they sold at the bottom, and any that held are well ahead.

This was to establish that the mere act of losing investor's money isn't fraud. And it's not a question of "intrinsic motivation", it's solely aa question of what they actually did.

Warren Buffett doesn't commit fraud because he tells his investors he's going to invest their money in equities, which has risk. If Berkshire Hathaway goes to zero because he made poor decisions, that's not fraud.

The ponzi scheme was fraud because he was paid to invest the money, but did not do that, instead he spent the money on himself and hid a bunch with his family. How hard is it to understand the difference between doing what you agree to do with someones money and stealing it?