Inside Money: Doing time for money

Stephen Versalko. Photo / Herald on Sunday

The world's greatest ponzi artist, Bernie Madoff, and his New Zealand equivalent, Stephen Versalko, have a lot in common: both ordinary family guys with credible, crumpled facades.

Versalko's dealings with prostitutes, currently being picked over in the high court, diminish the family man image somewhat but they do reveal a lot about how business can be transacted in the upper echelons of society.

The New Zealand Herald story quotes Catherine Healy, of the New Zealand Prostitutes Collective, detailing the nature of these "private arrangements".

"All sorts of the most remarkable arrangements come from private client relationships and this [Versalko case] is one of those," Healy told the Herald.

As is Bernie Madoff's case, which is displayed at length in this fascinating piece published recently in the New York Magazine.

The article, exploring his life in jail, reveals some of Madoff's methods, recounting, for example, this tale told by a former fellow inmate: "Bernie was telling a story about an old lady. She was bugging him for her money, so he said to her, 'Here's your money,' and gave her a check. When she saw the amount she says, 'That's unbelievable,' and she says, 'Take it back.' And urged her friends [to invest]."

The way Madoff tells the story, admittedly via intermediaries, his 'victims' practically forced him to take their money - who was he to turn it down?

According to the New York Magazine, Madoff developed a sense of scorn at their stupidity, allegedly yelling out to another inmate while in line waiting for his blood pressure medicine: "F*** my victims... I carried them for twenty years, and now I'm doing 150 years."

Versalko has been a lot nicer about his former clients, who unlike Madoff's, were at least reimbursed.

Madoff continues to offer financial advice to other inmates. Versalko will also no doubt get pestered for financial tips in jail but he better watch out - unless he registers as a financial services provider by December 1 this year that would be illegal.


David Chaplin