Before Madoff, There was Stavisky

Like Ponzi swindler Bernie Madoff, Sacha Stavisky (also known as Serge Alexander Stavisky) was a financier and embezzler of gargantuan proportions. Also like former lawn sprinkler salesman Madoff, Stavisky came from humble beginnings. He arrived in France as a penniless Russian Jewish immigrant and began perpetrating small pawnshop frauds, building a small fortune and a reputation as a financial wizard.

Unlike Madoff, Serge Stavisky was movie star handsome and a self-styled Parisian bon vivant. His marriage to Arlette, a glamorous one-name Chanel model, also helped his rise in French high-fashion society.

Stavisky's crime

While France came late to the Great Depression in 1931, it was the revelation of Stavisky's swindle in 1933 that nearly brought down the French economy and resulted in the collapse of two government administrations, bloody riots in the streets, and the rise of rightist groups like Action Francaise, which laid the groundwork for Vichy collaboration after the Nazi invasion of France in 1940.

Even though Stavisky was arrested for his schemes in 1927, he avoided prosecution until 1933 when his crime was revealed. Stavisky had issued hundreds of millions of francs worth of false bonds for the southwest France city of Bayonne. These bonds were backed by Bayonne municipal officials as well as higher-ups in the national government, and were sold to and caused the failure of major French life insurance companies. Adding insult to injury, Stavisky had claimed that his bonds as well as other fraudulent securities were backed by crown emeralds from the King of Ethiopia. The so-called emeralds turned out to be glass.

Stavisky's death

In January 1934, the French police found Sacha "Serge" Stavisky shot to death in an alpine chalet. The police claimed that the disgraced financier had committed suicide, but critics on the right charged that the police had assassinated Stavisky to protect influential accomplices in high places. This led to outcries and the collapse of the government of Premier Camille Chautemps.

Chief among the accusers was Jean Chiappe, the rightist leader of France's National Police. This caused new Premier Edouard Daladier to remove Chiappe from office, triggering strong protests from right-wing groups.

Riots of 1934

On February 6, 1934, these protests brought angry crowds to Paris's Place de la Concorde. Bloody riots caused the deaths of fifty people and the injury of thousands. Premier Daladier resigned immediately after regaining order in the streets.

After the Place de la Concorde riots, twenty Stavisky accomplices including Arlette Stavisky went on trial. Like Madoff's associates, they claimed to have confidence in Stavisky.

In 1974, legendary French director Alain Resnais released "Stavisky", a film about the swindler starry Jean-Paul Belmondo in the title role.