The Mask of Sanity

A glimpse into the mind of Wall Street psychopathy

Christian Bale in American Psycho.

With the FTX scandal continuing to make news, I thought I’d revive an old series of mine, originally written twelve years ago. Starting with this one. There have been many Wall Street psychopaths, and there will be many more to come. But Bernie Madoff can show us how it’s done.

In 1960 Madoff founded his Wall Street firm, Bernard L. Madoff Investment Securities LLC. As chairman of its Board of Directors until his arrest in December of 2008, Madoff saw his firm (and himself) rise to prominence on Wall Street, developing the technology that became NASDAQ, the first and largest electronic stock exchange in America, in the process. A multimillionaire with over $800-million in shared assets with his wife and high-school sweetheart, Ruth Alpern, Madoff was well-regarded as a financial mastermind and prolific philanthropist. He exuded an aura of wealth, confidence, and connections, and many trusted him as a pillar of the community. Sounds like a great guy, huh?

His humanitarian image was supported by his work for various nonprofit groups like the American Jewish Congress and Yeshiva University in New York, the various commissions and boards on which he sat, and the millions he donated to educational, political, cultural, and medical causes. As his firm’s website made clear at the time (it has long been removed): “Clients know that Bernard Madoff has a personal interest in maintaining the unblemished record of value, fair-dealing, and high ethical standards that has always been the firm's hallmark.” It’s funny how things change with a little perspective and a pattern emerges only in retrospect. It wasn’t until December of 2008 that the public became aware that this “personal interest” was anything but one of integrity, and this PR image stopped being taken for reality.

In a discussion with Condé Nast Portfolio Editor in Chief Joanne Lipman, Holocaust survivor, Nobel laureate and Madoff victim Elie Wiesel said: “I remember that it was a myth that he created around him … that everything was so special, so unique, that it had to be secret. It was like a mystical mythology that nobody could understand … He gave the impression that maybe 100 people belonged to the club. Now we know thousands of them were cheated by him.”

In what has been described as the largest investor fraud ever committed by single person, Madoff defrauded thousands of investors out of just under $65 billion in an elaborate Ponzi scheme, paying returns to investors from money paid by other investors, not actual profits. By moving funds in such a way, Madoff created an image of money that rivaled his own as a man of good character. The illusion of consistent, high returns lured thousands into a deal too good to be true, offered by a man too good to be true.

According to the media portrayal of events, Madoff described the investment fund as “one big lie” to his sons, who promptly informed the authorities. Madoff was arrested the next day and his assets were frozen (as were those of his wife and sons later on). In the aftermath, Madoff had succeeded in ruining the lives of thousands, driving some victims to suicide. He ended up pleading guilty to eleven counts of fraud, money laundering, and perjury, among others. Although Madoff claimed he was solely responsible for defrauding clients, investigators were unsatisfied that one person alone could hide fraud on such a massive scale for so long. Several of his former associates were eventually found guilty of their involvement with the fraud, and multiple lawsuits were filed against Ruth Madoff and her sons, one of whom committed suicide in 2010, the other dying of cancer in 2014. Madoff’s brother Peter got out of prison in 2020 and his whereabouts are currently unknown.

In 2021, at the age of 82, Madoff himself died in federal prison of natural causes—chronic kidney disease. Here’s what he had to say to his daughter-in-law about life in prison: “As you can imagine, I am quite the celebrity, and am treated like a Mafia don. They call me either Uncle Bernie or Mr. Madoff. I can’t walk anywhere without someone shouting their greetings and encouragement, to keep my spirit up. It’s really quite sweet, how concerned everyone was about my well being, including the staff … It’s much safer here than walking the streets of New York.”

So how did he pull it off? Jerry Reisman, a prominent New York lawyer, described Madoff as “utterly charming. He was a master at meeting people and creating this aura. People looked at him as a superhero.”¹ Even when he was scrambling to secure funds to keep up his dead-end fraud, associates noticed no signs of stress. In a 2007 roundtable conversation, Madoff makes some telling comments. Speaking about modern exchange firms, Madoff coolly says, “By and large, in today’s regulatory environment, it’s virtually impossible to violate rules. This is something that the public really doesn't understand … It’s impossible for a violation to go undetected. Certainly not for a considerable amount of time.” This coming from a man who had been doing just that since the 1980s!

No wonder, given his propensity for deceit, that Madoff and his firm were extremely secretive, finding ways of keeping their illegal activities hidden, e.g., by refusing to provide clients online access to their accounts and ordering employees—against regulations—to delete email after it had been printed on paper.²

Contrary to his illustrious public persona, in an article by Mark Seal for Vanity Fair, various family friends and insiders present an image of Madoff as a cold-hearted control freak who not only exploited strangers, but also those closest to him. He cultivated ostensibly close friendships with the late Norman F. Levy and philanthropist Carl J. Shapiro while robbing them blind in the process. Madoff spoke of Levy as his “mentor of 40 years” and always deferred to him. In return, Levy considered Madoff his “surrogate son, a member of his family.”

Carmen Dell’Orefice, Levy’s then-girlfriend, remembers, “He always did so much for Norman’s comfort in the smallest details.” She described Madoff and his wife as quiet and inconspicuous and expressed the cognitive dissonance often experienced by victims of conmen like Madoff when the truth behind the image is finally revealed: “I am accepting that what I was experiencing was a projection of a person who wasn't there … If I didn’t take all the pictures I took all those years, I would say ‘Carmen, you're delusional’.”

Levy’s son Francis said his father believed in Madoff: “If there’s one honorable person,” he said, “it's Bernie.” Joseph Kavanu, a former law school peer of Madoff’s shared similar disbelief with Julie Creswell and Landon Thomas Jr. in their piece for the New York Times: “It doesn’t make sense … I cannot take the Bernie I knew and turn him into the Bernie we’re hearing about 24/7. It doesn’t compute.” In reality, there were two Madoffs: the carefully cultivated image of the successful businessman and philanthropist, and the reality: a ruthless and remorseless criminal who operated behind a mask of sanity, success, and humanitarianism.

One source described to Seal how Madoff ruled his two sons through “tough love and fear. People were afraid of Bernie. He wielded his influence. They were afraid of his temper.” Madoff also ruled his office with an iron fist, controlling the work environment down to the smallest detail. He was obsessed with order and control. A family friend related, “There was a lot of arrogance in that family. Bernie would talk to people who were as rich as he was, but he didn’t want to be bothered with the little people.” Another insider said, “He was imperial, above it all. If he didn't like the conversation, he would just get up and walk away. It was ‘I’m Bernie Madoff and you’re not.’” Another said, “[Madoff's brother] Peter is much more religious, more even-keeled. Bernie is more cocky, arrogant, a showman. Shrewd like a fox.”

From the descriptions of those who knew and interacted with him, a picture emerges of Bernie Madoff as arrogant, superficially charming, glib, manipulative, deceitful, emotionally cold, domineering, and heartless—in short, all the hallmarks of a “successful” psychopath. Unsurprisingly, journalists and experts alike have suggested exactly that. J. Reid Meloy, forensic psychologist and author of The Psychopathic Mind, forensic psychologist Phil Heller, and former FBI agent Gregg McCrary have all said so in print,³ and several prominent researchers including Adrian Raine suggested the same at the 2009 conference for the Society for the Scientific Study of Psychopathy in New Orleans which I attended.

In typical psychopathic fashion, Madoff fought his way to the top, wooed the regulators, and built his fortune by conning those he saw as worthless, even screwing over his so-called friends. However, as Meloy told Creswell and Thomas, “the Achilles’ heel of the psychopath is his sense of impunity. That is, eventually, what will bring him down.”

What Is Psychopathy?

Until the publication of Hervey Cleckley’s landmark book The Mask of Sanity in 1941 and its subsequent editions, there wasn’t much agreement on the precise nature of psychopathy. The term had come to describe individuals whose emotional life and social behavior were abnormal, but whose intellectual capacities were undisturbed. In contrast to psychotics whose grip on reality is clearly disturbed—as in paranoid schizophrenia—psychopaths are completely sane. They have a firm grip on reality, can carry on a conversation, and often appear more normal than normal. But at the same time, while talking to you about the weather or the economy, they may be deciding the best way to con you out of your life savings or perhaps get you to a secluded location where they can rape or murder you.

However, while psychopaths may be intellectually aware that their actions grossly violate the limits of normal human behavior, they lack the emotional engagement with others that normally acts as an inhibitor of anti-social acts, like calculated aggression, intentional intimidation, pathological lying, and emotional manipulation. In the course of his (or her, as probably one in four psychopaths are female) development, the psychopath’s inability to feel and thus identify with the emotions of others blocks the development of a “moral sense” that allows normal individuals to care for others and treat them like thinking and feeling beings. Psychopaths just don’t care. To them people are things, objects. When they’re no longer useful they can be discarded or destroyed without a second thought.

The jarring disconnect between the absolutely normal (if not more than normal) face with which the psychopath greets the world, and the utterly unfathomable irrationality and inhumanity of his actions has led to their being called “wolves in sheep’s clothing” and “snakes in suits.” Cleckley coined the phrase “mask of sanity” to illustrate the disparity between the image of normality and the psychopath’s essential abnormality. While the label has come to be almost strictly associated with serial killers, rapists and arch-villains, Cleckley was quick to point out that the vast majority of psychopaths are not violent, and “only a small proportion of typical psychopaths are likely to be found in penal institutions, since the typical patient … is not likely to commit major crimes that result in long prison terms.”⁴ Their actions are antisocial in that they violate the almost universally agreed upon “rules” of social behavior. Of course, this often does take the form of crime, but many psychopaths operate successfully within the boundaries of the law, wreaking havoc interpersonally or monetarily.

After years of frequently encountering psychopaths in clinical practice and witnessing the immense suffering they inflict upon those who happen to fall within their sphere of influence, Cleckley identified several universal traits. On the one hand psychopaths are superficially charming and of good intelligence. They lack any delusions or other signs of irrational thinking and are free of nervousness and anxiety. In other words, they present an image of good “mental health” that can disarm even the most experienced judge of human character. However, a close analysis of their life history and interactions with others reveals some striking deficits beneath the mask.

Psychopaths are also notoriously insincere, liberally inserting lies and innuendo into their talkative stream that often go unnoticed. They are usually impulsive, acting on whims, and seeming to live entirely in the present, unhindered by concerns for past failures and future consequences. As such they often show remarkably poor judgment and an inability to learn from punishments or the threat of future ones. (Psychopathic criminals have the highest recidivism rates). They are unreliable, often moving from job to job and city to city, finding new victims and living parasitically off of others’ kindness and naiveté. They also have a pathological sense of entitlement. The center of their own universe, they are incapable of love, lack any sense of remorse or shame, and show a general poverty of any deep emotional life. This is the core feature, shared equally by all psychopaths: the inability to feel empathy.

While Cleckley did much to bring light on the issue, in the preface to the fifth and final edition of his book he described “an almost universal conspiracy of evasion” of the topic of psychopathy among North American researchers and clinicians. While institutions exist to deal with illness and crime, when it comes to psychopathy “no measure is taken at all … nothing exists specifically designed to meet a major and obvious pathologic situation.”⁵

Psychopathy arguably accounts for a grossly disproportionate amount of damage to society. Cleckley was convinced that the first step to deal with this immense problem was to “focus general interest” and “promote awareness of its tremendous importance.”⁶ Thankfully, significant contributions have been made in recent years towards such a goal by writers like Robert Hare and Paul Babiak, clinicians like Martha Stout and Sandra Brown, and popular media portrayals such as the documentaries The Corporation and I, Psychopath. Unfortunately, even with these efforts, public knowledge about psychopathy still falls far short of ideal, the “conspiracy of evasion” persists, and the problem rages on. For a disorder affecting more people than schizophrenia,⁷ and causing exponentially more harm to society, the fact that psychopathy is not a generally understood concept is alarming.

Robert D. Hare, Professor Emeritus of psychology at the University of British Columbia, wrote a book in 1970 summarizing the research available at the time. Since then, he has been at the forefront of psychopathy research, developing the first valid measure of criminal psychopathy, the Psychopathy Checklist (PCL-R), and writing two bestsellers on the subject: Without Conscience in 1993 and Snakes in Suits (co-authored with Paul Babiak) in 2006. Working with criminal populations, Hare further refined Cleckley’s list of psychopathic traits for the PCL-R, settling on twenty characteristics of a prototypical psychopath.

Whereas Cleckley described his psychopathic patients as “carr[ying] disaster lightly in each hand” and “not deeply vicious,”⁸ Hare's Without Conscience presents a much more malevolent look into the mind of the criminal psychopath. As he puts it:

Psychopaths have what it takes to defraud and bilk others: They are fast-talking, charming, self-assured, at ease in social situations, cool under pressure, unfazed by the possibility of being found out, and totally ruthless. ... Psychopaths are generally well satisfied with themselves and with their inner landscape, bleak as it may seem to outside observers.⁹

They see empathy, remorse, and a sense of responsibility—all the qualities usually considered as the epitome of goodness and humanity—as signs of weakness to be exploited; laws and social rules as inconvenient restrictions on their freedom; and antisocial behavior as deliberate “nonconformity,” a refusal to “program” by society’s artificial standards. Love, kindness, guilt, and altruism strike the psychopath as comical and childish naiveties for “bleeding hearts,” and psychopathic serial murderer Ted Bundy even called guilt “an illusion … a kind of social-control mechanism.”¹⁰ While they may convincingly profess to love in the most romantic and meaningful verbosity to their partners, these displays are soon replaced with domination and exploitation, as Sandra Brown shows in her 2009 book Women Who Love Psychopaths.

Psychopaths see normal life as dull and boring, a dog-eat-dog world in which potential enemies are to be manipulated, and aggression used as a tool to establish their superiority and take what is rightfully theirs—to satisfy their grandiose sense of entitlement. Naturally, in a universe of one, Hare observes, “Obligations and commitments mean nothing to psychopaths. … They do not honor formal or implied commitments to people, organizations, or principles.”¹¹ They may very well ask, "What's so bad about being articulate, self-confident, living a fast-paced life on the edge and in the now, and looking out for number one?" And in our decaying society, many would not disagree. But what the psychopath sees as a carefree life of excitement and entitlement usually amounts to little more than the pursuit of immediate moments of pleasure and feelings of power, whether fleeting or more long-lasting.

With Hare’s work, the psychopathic “mask” of sanity and normality acquires a sinister and Machiavellian tone. That’s because psychopaths are conscious of being different. They see normal people as inferiors—“others”—to be used and discarded when they are no longer needed. But like a predator among its prey, psychopaths must disguise themselves to evade detection. If they made their motives known, others would be horrified. So, from an early age they learn to fit in by copying normal human reactions and behaviors. They learn when it is appropriate to cry, show grief, guilt, concern, and love. They learn all the facial expressions, common phrases, and social cues for these emotions they do not feel. And as such, they deceive others with false displays of sadness, grief, guilt, concern, and love, and they manipulate our reactions to get what they want. That’s how a psychopath is able to con you out of money by playing on your sense of pity and compassion.

Normal people, unaware of the differences between psychopaths and themselves, assume that these displays of emotion are evidence of actual emotion, and so the psychopath succeeds in going unnoticed, like a wolf in sheep’s clothing. “[T]he truly talented ones have raised their ability to charm people to that of an art, priding themselves on their ability to present a fictional self to others that is convincing, taken at face value, and difficult to penetrate.”¹²

This “practice” at appearing human is expertly portrayed in Mary Astor’s novel The Incredible Charlie Carewe, which Cleckley recommended “should be read not only by every psychiatrist but also by every physician” because of its remarkably accurate portrayal of a psychopath.¹³ This “act” is a matter of survival for a psychopath, lest their “inhumanity” be discovered. After all, most people do not react positively to a child or adult who potentially can, as Hare put it, “torture and mutilate [a human being] with about the same sense of concern that we feel when we carve a turkey.”¹⁴

Psychopaths also keep up their “psychopathic fiction” by being charming conversationalists. They expertly tell “unlikely but convincing” stories about themselves, easily blending truth with lies. Not only can they lie effortlessly; they are completely unfazed when caught in a lie. They simply rework their story, to the befuddlement of those who know the truth. They may feign remorse, but are equally skilled at rationalizing their behavior, often portraying themselves as the victims (and blaming the real victims). One female psychopath complained that no one cared about how she felt, having lost both her children. In fact, she was the one who had murdered them. In cases like this, the mask slips ever so slightly, as when the less intelligent psychopath attempts to use emotional concepts he cannot understand. One inmate told Hare, “Yeah, sure, I feel remorse [for the crime].” However, he didn’t “feel bad inside about it.”¹⁵

Even their violent outbursts of “rage” are carefully controlled displays. One relatively self-aware psychopath revealed, “There are emotions—a whole spectrum of them—that I know only through words, through reading and in my immature imagination. I can imagine I feel these emotions (know, therefore, what they are), but I do not.”¹⁶ Another, confused when asked how he felt, was asked about the physical sensations of emotion and responded, “Of course! I’m not a robot. I really get pumped up when I have sex or when I get into a fight.”¹⁷ Capable of only the most primal body-based feelings, the psychopath has no intense emotions to be in control of; any display of such is an act with the intent to manipulate.

As to the causes of this disturbing disorder, researchers are now confident that, contrary to the once common belief that psychopathy must be caused by childhood trauma, it has a substantial genetic and biological basis. In his 2007 update on the last twenty years of psychopathy research, Robert Hare comments: “I might note that the early results from behavioral genetics research are consistent with the evolutionary psychology view that psychopathy is less a result of a neurobiological defect than a heritable, adaptive life-strategy.”¹⁸ Or, as he put it in Without Conscience:

I think [childhood experiences] play an important role in shaping what nature has provided [i.e. “a profound inability to experience empathy and the complete range of emotions”]. Social factors and parenting practices influence the way the disorder develops and is expressed in behavior. Thus, an individual with a mix of psychopathic personality traits who grows up in a stable family and has access to positive social and educational resources might become a con artist or white-collar criminal, or perhaps a somewhat shady entrepreneur, politician, or professional. Another individual, with much the same personality traits but from a deprived and disturbed background, might become a drifter, mercenary, or violent criminal. … One implication of this view for the criminal justice system is that the quality of family life has much less influence on the antisocial behaviors of psychopaths than it does on the behavior of most people.¹⁹

In line with this understanding, psychopathy can be detected at an early age. By the age of 10 or 12, most psychopaths exhibit serious behavioral problems like persistent lying, cheating, theft, fire-setting, truancy, class disruption, substance abuse, vandalism, violence, bullying, running away, precocious sexuality, cruelty to animals. One psychopath smiled when he reminisced to Hare about tying puppies to a rail to use their heads for baseball-batting practice.²⁰ However, the exact causes (and possible steps to prevent it in infancy and early childhood) are still unknown.

Children predisposed to psychopathy who do not show obvious signs later in life probably become successful at avoiding detection because of such factors as increased intelligence and abilities to better plan and control their behavior. While the vast majority of research has been conducted on prison populations, because of the relative ease of research opportunities, the concept of the successful psychopath (whether that means he is not criminal or simply doesn’t get caught) is a relatively recent topic of interest for specialists and is not yet clearly defined or publicly understood, just as with the term “psychopath” in the early twentieth century.

In the context of ponerology, it is these psychopaths—the ones who avoid detection—who become successful and ruthless politicians and government insiders, and the ones who characterize totalitarian systems of government, like those of the 20th century and that emerging today.

Continued in “Snakes in Suits.”

1. Tim Shipman, “Bernard Madoff: how did he get away with it for so long?,” telegraph.co.uk, December 20, 2008.

2. As reported by Lucinda Franks “Madoff Employee Breaks Silence,” The Daily Beast, March 19, 2009.

3. Katy Brace, “Psychologist calls Madoff a psychopath,” wptv.com, January 29, 2009.

4. Cleckley, H. 1988 [1941], The Mask of Sanity (Augusta, Georgia: Emily S. Cleckley), 19, PDF available here.

5. Ibid., viii.

6. Ibid., ix.

7. Goldner et al. (2002) put the prevalence of schizophrenia at 0.55% of the general population, and while accurate studies of psychopathy are not very plentiful, a few limited studies show that the low limit for psychopathy is 0.6% (Coid et al., 2009). Some estimates go many times higher than that figure, factoring in various definitions of successful psychopaths.

8. Cleckley, 33.

9. Hare, R. D. 1999 [1995], Without Conscience: The Disturbing World of Psychopaths Among Us (New York: Guilford Press), 121, 195.

10. Ibid., 41.

11. Ibid., 63.

12. Babiak, P. & Hare, R. D. 2006, Snakes In Suits: When Psychopaths Go To Work (New York: ReganBooks), 50.

13. Cleckley, 326.

14. Hare, 45.

15. Ibid., 41.

16. Ibid., 52-3.

17. Ibid., 54.

18. Hare, R. D. 2007, “Forty Years Aren’t Enough: Recollections, Prognostications, and Random Musings,” In Herve, H., and Yuille, J. C. (eds) The Psychopath: Theory, Research, and Practice, pp. 3-28 (Lawrence Erlbaum Associates), 14. However, studies show distinct differences in the brain functioning of psychopaths when compared to normal individuals. For the latest state of the research, see Thomson, N. D. 2019, Understanding Psychopathy: The Biopsychosocial Perspective (New York: Routledge).

19. Hare (1999), 173-4.

20. Ibid., 66-7.