When Bernard Madoff was arrested in December last year, it sent shockwaves around the world.

Feted as the greatest conman in history, the New Yorker's hugely successful wealth management business was in reality an elaborate Ponzi scheme that defrauded billions of dollars out of his fellow financial experts, close friends and even members of Europe's royal elite.

"It really is an extraordinary story, because to run something like that is quite complicated," says British journalist Adam LeBor, who has just published The Believers, about Madoff.

"It's not like robbing a bank where you run in, wave a gun around and run out with the cash. We don't know how long this went on for but it must have been going on for 20, if not 30, years. At any moment, he could have been busted. Can you imagine being able to handle that kind of psychological pressure, and also all the people that worked with him, because it was a very complicated operation? He had thousands of clients who all received statements every month of how their accounts were doing. But they were totally fictitious. He was a criminal genius."

Ponzi schemes, named after Italian immigrant Charles Ponzi, who wreaked havoc across America with a similar conspiracy in the early 20th century, involve paying investors out of their own or other investors' funds.

But while there have been many similar incidents, none have come close to matching the size and scale of Madoff's efforts.

"Not unless there's something else that has been going on that we don't know about," laughs LeBor.

"Of known frauds, this was certainly the most complicated, and probably the biggest in history. And it didn't crash because he got arrested or got caught, but because of the credit crunch, as institutional investors wanted their money back. If there hadn't been an economic crisis, it might still be going."

The Believers is a first venture into financial writing for Budapest-based LeBor, who previously explored the relationship between Switzerland and Nazi Germany in Hitler's Secret Bankers.

"I just thought [Madoff] it was a fascinating story," he says.

"It broke at a time when business stories were in the news every day, and I thought it was an interesting crossover between the world of finance and human interest. I started investigating it and realised that there was a great book to be written that talks so much about human nature."

LeBor was intrigued by the psychological aspects of Madoff's fraud, which saw investors almost convincing themselves that they would reap vast profits.

"That's why the book is called The Believers," he says.

"It seemed amazing that all these experienced investors, and a lot of institutions as well, really believed that this man could somehow beat the markets year in year out when no one else could ever do that. No one thought to ask any difficult questions about how he could do that."