I don’t think it’s the same thing as buying a Powerball ticket for $2 and not winning $1.4 billion. With Powerball, no one sent you statements for years telling you that your account was worth $1.4 billion and no one told you that the funds were available any time you wanted to withdraw them. It’s a logical conclusion that you really do have $1.5 billion to your name. You live your life based on that assumption – for example, spending a lot of money to set up elaborate trusts and so forth, so your children and grandchildren will be provided for. No one gets reimbursed those fees, do they.
I understand that there’s a risk with any investment. But with any real investment, you know when it’s working and when it’s not. If you lose some of your principal, you have the opportunity to look around and assess if you can do better in another investment. You have the same facts as everyone else and the same opportunities as everyone else. With Madoff, investors had no facts at all with which to make up their minds. The “facts” they thought they had were all fantasy.
I don’t fault the people who were taken in. I completely fault Madoff.