Emily St. John Mandel Takes on a Madoff-Inspired Ponzi Scheme

Emily St. John Mandel’s last book, ‘Station Eleven,’ was about a pandemic. Her latest is about financial collapse.

Photo: Ulf Andersen/Getty Images

With the coronavirus spreading fear and upending the financial world, Emily St. John Mandel seems especially prescient at choosing her novels’ subjects. Sales have been surging for her fourth book, “Station Eleven” (2014), in which a lethal disease called the Georgia Flu quickly spreads across the world. Now “The Glass Hotel,” which Knopf will publish on Tuesday, depicts the fallout of financial collapse.

Although the new book was inspired by the Bernard Madoff Ponzi scheme that was exposed during the 2008 financial crisis, the story includes a range of characters adjacent to the fraud, with themes of class, complicity and what people do to gain and keep wealth. “Once you start writing about a massive financial crime, you’re writing about money broadly speaking,” Ms. Mandel says.

The character Jonathan Alkaitis in “The Glass Hotel” bears no resemblance to Mr. Madoff, but his crime is a near duplicate. He creates a bogus investment fund that bilks charities, individuals and companies out of billions of dollars. As in the Madoff case, the scheme collapses in December 2008 when Alkaitis is arrested.

The novel swoops back and forth in time. It is written from multiple points of view, including Alkaitis, two of his victims, several employees complicit in his fraud, and a heroine named Vincent.

Vincent, who is adrift personally, has returned to the isolated Canadian island where she grew up, and works as a hotel bartender. She meets Alkaitis, the hotel’s owner, and they settle into mutually beneficial arrangement in which she becomes his second wife, or so the world thinks, and she enters what she thinks of as the easeful “kingdom of money.” Ms. Mandel says, “I liked the idea of a trophy wife who was also quite brilliant.”

Ms. Mandel, who is 41, grew up on Denman Island off the coast of British Columbia, a less remote place than the one in her novel, and lives in Brooklyn. Here, an edited transcript.

What intrigued you about the Madoff case?

One was the scale of the crime. Another was the way Madoff seemed almost like the embodiment of an era. What I remember from that time of the [2008] economic collapse is that there was incredible popular rage directed against him, but it wasn’t just about the crime. We’d been operating under the assumption that our economy was fairly solid, but it turned out to have been a house of cards. And here was this fabulously wealthy con man who had stolen all of this money from so many people, the man in the empty suit.

Did you have any background in finance, or consult anyone in that world as research?

I have very little background in finance. For the purposes of this book, figuring out how the scheme worked was enough. I read books and the court transcripts, which were fascinating and sometimes wrenching. I didn’t consult anyone in a formal way, but somebody quite close to me was a Madoff investor. He says now, “We’d go over those financial statements. They never made sense. We could never figure out where those numbers were coming from, but the returns were so good, I shrugged.” There was a kind of collective delusion at play.

One of Alkaitis’s victims is Olivia, an artist in her 70s who loses all of her small savings.

There is an unfortunate phenomenon around the way artists think about money, which is that it’s just not part of their calculation. That carefree Bohemian lifestyle doesn’t always age well, and what can seem charming and romantic in your early 20s takes on a very different character by your mid 40s, let alone your 70s. Olivia hadn’t educated herself about money, and trusted her friend Jonathan. She is a purely tragic character.

The thoughts of the various employees complicit in the Ponzi scheme are written in a joint first-person voice called “The Office Chorus.” Why link them?

I found myself fascinated by the collective guilt. Does the presence of all of these co-conspirators make it easier to commit the crime? They begin, “We had crossed a line.” I think it’s easier to say we crossed a line, than I crossed a line. I found myself thinking about the camaraderie one has with any group of co-workers and how much more intense that would be if you were engaged in a crime. Imagine going into work and realizing you could call the FBI on any of your colleagues at any moment.

Vincent learns that having money gives her “the freedom to stop thinking about money.” What has your own relationship to money been?

I’m from a working-class background. There was always a low-level anxiety about money. Following the success of ‘Station Eleven,’ I’m fairly financially comfortable. My experience is that it’s just revelatory to not have to constantly think about money.

Since the coronavirus hit, have you been hearing from readers about “Station Eleven”?

Only via Twitter, and responses are divided. Some people seem sort of mad that they chose to read a pandemic novel during a pandemic. Other people seem comforted by it. I would personally not choose to read a pandemic novel during a pandemic. Maybe wait a few months. When I was researching “Station Eleven,” what quickly became obvious is that epidemiologists talk about pandemics the same way seismologists talk about earthquakes. Nobody talks in terms of “I wonder if there will ever again be another earthquake.” Pandemics are wrenching and terrifying and really hard. They are also part of the human experience.

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