How far would client expectations push you?

Originally published at

Let me quote first from the statement Bernard Madoff made in Federal Court as he pled guilty to 11 felonies.

At that time, the country was in a recession and this posed a problem for investments in the securities markets. Nevertheless, I had received investment commitments from certain institutional clients and understood that those clients, like all professional investors, expected to see their investments out-perform the market. While I never promised a specific rate of return to any client, I felt compelled to satisfy my clients’ expectations, at any cost. I therefore claimed that I employed an investment strategy I had developed, called a “split strike conversion strategy,” to falsely give the appearance to clients that I had achieved the results I believed they expected.

The bold is my own.

While I’m not condoning Mr. Madoff’s actions, I find myself wondering how many times we are forced into a situation to do something for a client who is immoral, amoral, unethical or a combination of all because they have an “expectation” that is not in line with their reality. And because they are the lifeblood of our organization, we bow to the pressure to do it “just this one time” or until we no longer have to. But like Madoff, that one time turns into a lifetime of “just this one time.”

In the tech world, we used to put BOT in the comment code to wink to other programmers that this code was understood to not be smart or prudent, but only that the Boss Ordered This. It was a way to lighten the burden on the soul and not compromise the paycheck and the home and family it provided for. But with every BOT entry, we made a silent vow to escape as soon as we could.

I’m fairly certain Madoff made those vows with every transaction, but soon found himself with no way out except to keep going. His clients had expectations of him and he found his brand built on those expectations. Perhaps he hoped that he could carry his scheme out long enough so that his death — and not the Federal Government — would release him from the hell his first “client expectations” put him in.

The newspapers are full of quotes of “victims” who invested without questioning Madoff’s real assets. At the time they invested, they did not want to know the risk; they only wanted returns. In truth, there were some charities that were real victims of Madoff’s scheme, but for the most part, the victims were educated investors who should have known enough to ask the questions. Yet, their vanity and need to be included in an “inner circle” were stronger than their common sense or morality.

I question whether or not they have a right to be indignant and judgmental of Mr. Madoff. Perhaps they should be looking deeper into their own souls and asking themselves if their expectations were complicit. If their souls are working, they may come up with an inconvenient truth.

I scoured the newspapers to find mention of Madoff’s “client expectations” but only found excerpts of his guilt, how he was sorry he hurt people, etc. Perhaps we rest easier as a nation knowing that we put away one bad guy than having to wrestle with the clear moral argument that our collective greed brought us each to the recession we find ourselves in.

But it all started with satisfying a client’s unrealistic expectations “just this one time.”