New dogs, old tricks. Why do Ponzi schemes succeed?

The Madoff saga is a vivid reminder of people's vulnerability to Ponzi schemes, and to how little the financial scams change over time. How are we to account for such schemes? Why do people fall for the same old tricks?Who is to blame? What psychological and other factors come into play? Can anything be done to protect investors? What role can be played by the financial sector in all of this? Should more be expected of auditors, regulators and financial custodians? These are the questions considered in this article, drawing on an examination of three Ponzi schemes.