Madoff was a ponzi scheme that relied on new investment (since it was simple pyramid). Medallion fund limits outside investment (so there is no outside source of money) and has operated for many decades (ie more money was withdrawn from it than put in).

I know nothing of Medallion, but I'm curious if only private insiders can invest, how do you know they're not just lying about how much they return?

Such returns would not be possible if they grew to a certain size. By closing the fund, they can keep it small enough to limit scaling issues.

That's illogical because people don't get paid in ROI. They get paid in absolute dollars. Earning a 30% ROI on 200 billion dollars is better than earning a 30% ROI on 100 billion dollars.

My point is that once a fund grows to a certain size, ROI at that scale becomes impossible. I wouldn't be surprised to learn that some of their funds have investment restrictions and mandatory distributions.

But they do have other funds. It's simply they want to keep their money in higher return fund and other people's money in the bigger, lower return fund.

It allows family and former employees, so it is actually A LOT of people. Kind of hard to keep a conspiracy with 100+ people for 30+ years. Why would all these people lie?

All the family, employees, and former employees have a maximum investment. Every year they withdraw funds so that the principle never exceeds a certain threshold.