The Goldman Sachs Bankster Casino – Where The Hell Is The Outrage?

The Obama administration is pure Wall Street, Federal Reserve, CFR and Trilateral Commission. There is no change. The banksters have free reign in America.

Change we can believe in.

Related information:
The US Government: Bought and Paid For
Treasury Secretary Geithner’s Closest Aides Reaped Millions Working for Banks, Hedge Funds
Goldman Sachs Banksters Set to Pay Record £14 Billion in Bonuses
Government Watchdog: Treasury and Federal Reserve Knew Bailed-Out Banks Were Not Healthy, Lying to Americans
Goldman Sachs to be paid $1bn if CIT fails, while US taxpayers would lose $2.3bn
US: Utah approved a $27.3 million incentive package to keep Goldman Sachs, bringing the total amount to $47.3 million
Congresswoman Marcy Kaptur: There Has Been a Financial Coup D’Etat

Mike Shedlock:
“I am outraged that the Obama Administration promised change and did not deliver. “Yes We Can” was a lie. The reality is “It’s Business As Usual, Only Worse, With Higher Deficits”.”

“I am outraged there is not enough outrage over this.”

“Where the hell is the outrage?”


The number of articles and opinions on Goldman Sachs earnings, bonuses, and influence peddling over the past several days is quite stunning.

Many have pointed out the problems; few have expressed outrage over what is happening in general, not just at Goldman Sachs. Let’s take a look.

My take is at the end.

Letting The Dice Roll

Rolfe Winkler at Contingent Capital is writing Letting Goldman Roll The Dice.

Is Goldman really such an indispensable financial intermediary? One look at the firm’s revenue breakdown shows that it’s more casino than anything else, and some of the markets it makes still put the economy in danger.

(Click on image to enlarge.)

Goldman, in other words, generates most of its revenue trading its own money and earning vigorish on customer transactions. It’s a hybrid hedge fund and bookie, with an investment bank and asset management business thrown in for good measure.

With that in mind, one is left to wonder whether Goldman was really worth saving last year. What have taxpayers received for the $50 billion worth of cash and guarantees, for giving Goldman access to the Federal Reserve as its lender of last resort?

Saving Goldman was largely about saving the derivatives market, which is so big and unstable that the death of one counterparty could mean the death of all. With big commercial banks like JPMorgan Chase in deep, saving the derivatives business was as much about protecting depositors and maintaining the integrity of the payment system as it was derivatives themselves.

Read moreThe Goldman Sachs Bankster Casino – Where The Hell Is The Outrage?

Goldman Sachs executive named first COO of SEC enforcement

WASHINGTON — A Goldman Sachs executive has been named the first chief operating officer of the Securities and Exchange Commission’s enforcement division.

The market watchdog agency said Friday that Adam Storch, vice president in Goldman Sachs’ Business Intelligence Group, is assuming the new position of managing executive of the SEC division.

The move came as the SEC has been revamping its enforcement efforts following the agency’s failure to uncover Bernard Madoff’s massive fraud scheme for nearly two decades despite numerous red flags.

Storch, who will be responsible for project management and operations, will report to SEC Enforcement Director Robert Khuzami.

Read moreGoldman Sachs executive named first COO of SEC enforcement

Markopolos: Bernie Madoff’s Ponzi Scheme ‘Will look Like Small-Time’


Harry Markopolos — the whistleblower on Bernie Madoff who proved to be much smarter than the SEC — says there are evildoers out there who will make the Ponzi scum “look like small-time.”

Markopolos gave a speech to 400 of the faithful at the Greek Orthodox Church in Southampton and predicted major scandals will soon be revealed about the unregulated, $600 trillion, credit-default swap market.

“To put it in simple terms, it is like buying fire insurance policies from five different insurance companies on your neighbor’s house and then burning down the house,” he said.

After his lecture, Hampton Sheet publisher Joan Jedell reports Markopolos was feted at a dinner at Nello Summertimes hosted by John Catsimatidis and his wife, Margo, who were joined by Al D’Amato and Greek shipping magnates Nicholas Zoullas and Spiros Milonas.

August 12, 2009

Source: The New York Post

The US government completely ignored Harry Markopolos:

Markopolos: I gift wrapped and delivered the largest Ponzi scheme in history to the SEC

Madoff whistleblower to slate ‘inept’ SEC regulators:
“It led me to conclude that the SEC securities lawyers, if only through their ineptitude and financial illiteracy, colluded to maintain large frauds such as the one to which Madoff later confessed.”

Madoff whistleblower wants to be left alone

Whistleblower document warned SEC in Nov. 2005 about Madoff’s Ponzi scheme

– A Madoff Whistle-Blower Tells His Story

Taxpayer money at work!

New Secrecy Rule Lets Goldman Sachs Control Stock Prices Unmolested by Public Scrutiny

The new rule means the public will no longer be able to tell if large investment banks are manipulating the stock market for their own gain.


Headquarters of Goldman Sachs Group Inc., in New York

The New York Stock Exchange quietly announced last week that it would end its practice of requiring companies to report all their program trading — a move that helps shield large investment banks, particularly Goldman Sachs, from public scrutiny.

The new rule means the public will no longer be able to tell if large investment banks are manipulating the stock market for their own gain, says Matt Taibbi, the journalist whose Rolling Stone article on Goldman Sachs’ role in asset bubbles over the past century has rocked the financial world.

According to previous NYSE rules, any company that carried out program trading — essentially, large computer-automated trades worth more than $1 million — had to report the trades to the NYSE, which then made the information publicly available.

But, under new regulations (PDF) published last week, that requirement has been removed.

“The NYSE announced that it will no longer be releasing its weekly program trading data,” Taibbi wrote in a blog posting. “This is quiet obviously a move designed to make it even more impossible to track what’s going on in the NYSE and shield, in particular, Goldman Sachs.”

Read moreNew Secrecy Rule Lets Goldman Sachs Control Stock Prices Unmolested by Public Scrutiny

BBC: Allen Stanford may have been a US government informer

Sir Allen Stanford denies any wrongdoing at his Antiguan bank

Evidence has emerged that the Texan who bankrolled English cricket may have been a US government informer.

Sir Allen Stanford, who is accused of bank fraud, is the subject of an investigation by the BBC’s Panorama.

Sources told Panorama that if he was a paid anti-drug agency informer, that could explain why a 2006 probe into his financial dealings was quietly dropped.

Sir Allen vigorously denies allegations of financial wrongdoing, despite a massive shortfall in his bank’s assets.

Related information:
Kucinich: Who Told SEC to “Stand Down” on Stanford Probe?

US authorities had been investigating Allen Stanford for 15 years! (Times)

FBI tracks down Texas financier in $8 billion fraud case (AP):
Stanford is not under arrest and is not in custody.
Past probes sought to tie Stanford to drugs (Houston Chronicle)
Former Assistant Secretary of Housing: The U.S. is the Global Leader in Illegal Money Laundering

But the British receiver of his failed Stanford International Bank – based in Antigua – told Panorama that the books clearly show the deficit.

Secret documents

Of the $7.2bn (£4.8bn) in deposits claimed by the bank, only $500m (£331m) has been traced.

The UK government does take financial malpractice very seriously and issues regular advice on countries and jurisdictions where there may be serious deficiencies in regulation
Foreign Office spokesman

The $6.7bn (£4.4bn) black hole in Sir Allen’s off-shore bank affects 28,000 depositors – 200 of whom are British, who have collectively lost $80m (£53m) – and raises serious questions for the British Foreign Office and the American authorities.

Secret documents seen by Panorama show both governments knew in 1990 that the Texan was a former bankrupt and his first bank was suspected of involvement with Latin American money-launderers.

Read moreBBC: Allen Stanford may have been a US government informer

Kucinich: Who Told SEC to “Stand Down” on Stanford Probe?

Chairman of Domestic Policy Subcommittee Opens Inquiry

Chairman of the Domestic Policy Subcommittee, Congressman Dennis Kucinich (D-OH) today sent a letter to Ms. Mary Schapiro, Chair of the Securities and Exchange Commission (SEC) requesting documents that could reveal which government agency told the SEC to “stand down” rather than take enforcement action against the Stanford Group in October 2006 as has been reported by the New York Times.

Related articles:
US authorities had been investigating Allen Stanford for 15 years! (Times)

FBI tracks down Texas financier in $8 billion fraud case (AP):
Stanford is not under arrest and is not in custody.
Past probes sought to tie Stanford to drugs (Houston Chronicle)

Recent media reports have indicated that the SEC was aware of improprieties at Stanford Financial Group as early as October 2006, but withheld action at the request of another government agency.

In a report published in the February 17th edition of the New York Times, an SEC official said that an inquiry had been opened on Stanford in October of 2006. According to the Times report, an associate regional director of enforcement said the SEC “stood down” on its investigation as a result of the intervention of another federal agency.

Stanford is now the focus of an $8 billion fraud investigation and, presumably, an earlier inquiry would have spared many Stanford investors and triggered similar inquiries into other funds which lacked transparency.

“The SEC’s recent filing against Stanford stemmed from the 2006 SEC inquiry that had been apparently shelved at the request of the unnamed agency. If this is true, we must find out why the SEC delayed enforcement, and if there were other cases where other government agencies intervened to block enforcement,” Chairman Kucinich said.

“If the SEC did indeed begin an inquiry in 2006 and was called off by another agency, our subcommittee will demand that the SEC reveal the name of that agency which told it not to enforce federal laws which protect investors,” said Chairman Kucinich.

Read moreKucinich: Who Told SEC to “Stand Down” on Stanford Probe?

US authorities had been investigating Allen Stanford for 15 years!

American authorities have been suspicious of Allen Stanford’s financial dealings for 15 years but only accelerated their investigation after the Bernard Madoff fraud was exposed, it was claimed today.

As investigators continued to hunt Mr Stanford and the $50 billion (£35 billion) of assets connected to him, a financial expert said that the Texan had been on “everybody’s radar” for more than a decade.

Related articles:
FBI tracks down Texas financier in $8 billion fraud case (AP):
Stanford is not under arrest and is not in custody.
Texas-Sized Fraud Spreads To 131 Countries (CBS News)
Stanford lies low as clients count cost of fraud (Reuters)

The claim, made by the journalist and author Jeffrey Robinson, came as a link was made for the first time between the cricket impresario and a feared Mexican drugs cartel.

Read moreUS authorities had been investigating Allen Stanford for 15 years!

FBI tracks down Texas financier in $8 billion fraud case

Texas financier Allen Stanford, pictured in 2008, who is alleged to have committed multibillion dollar fraud, has been located in Virginia, the FBI confirmed on Thursday. (AFP/File/Jewel Samad)

WASHINGTON – Texas financier R. Allen Stanford was tracked down Thursday in Virginia, where FBI agents served him with legal papers in a multibillion-dollar fraud case. FBI agents, acting at the request of the Securities and Exchange Commission, served Stanford papers in Fredericksburg, Va., said FBI spokesman Richard Kolko.

Stanford is not under arrest and is not in custody.

Related articles:
Texas-Sized Fraud Spreads To 131 Countries (CBS News)
Stanford lies low as clients count cost of fraud (Reuters)
Stanford scandal ensnares Yankees’ Damon, Nady (FOXSports)

In a civil papers Tuesday, the SEC alleged Stanford and three of his companies committed an $8 billion fraud that lured investors with promises of improbable and unsubstantiated high returns on certificates of deposit and other investments.

Until regulators got help Thursday from the FBI, the SEC had not been able to find Stanford.

Read moreFBI tracks down Texas financier in $8 billion fraud case

Markopolos: I gift wrapped and delivered the largest Ponzi scheme in history to the SEC

House Hearing On Madoff

Former investment manager Harry Markopolos, who investigated investment adviser Bernard Madoff in the 90’s, testified before the House Financial Services Subcomittee on his experiences with the Securities and Exchange Commission. This is the second in a series of hearings on the Madoff investment scheme.

Source: YouTube

MORE: Here

Madoff whistleblower to slate ‘inept’ SEC regulators

The man who repeatedly tried to blow the whistle on Bernard Madoff’s $50bn (£34.7bn) fraud will this morning brand regulators at the US Securities and Exchange Commission as “inept” and “financially illiterate”.

In a damning written testimony prepared for Congress, where he will be appearing before the House financial services committee, Harry Markopolos says he feared for his safety during a nine-year campaign to unmask Mr Madoff, one of Wall Street’s grandees and a former chairman of the Nasdaq stock exchange. Mr Madoff confessed in December to running “a giant Ponzi scheme” which faked returns for thousands of investors built over several decades.

Mr Markopolos, a Boston accountant, says he waged the equivalent of a military campaign, using tip-offs and intelligence reports from field officers, to build the case against Mr Madoff, but when he passed his concerns to the SEC he was repeatedly “dismissed and ignored”. He says: “It led me to conclude that the SEC securities lawyers, if only through their ineptitude and financial illiteracy, colluded to maintain large frauds such as the one to which Madoff later confessed.”

Read moreMadoff whistleblower to slate ‘inept’ SEC regulators

Global Economic Crisis Accelerating

Richest apartment block in US becomes a house of horrors (Guardian):
The lavish apartments of 740 Park Avenue are home to 30 of America’s wealthiest and most influential families. At least they were until the historic confluence of financial disasters struck, lopping billions of dollars off their combined net worth. Now the formerly untouchable denizens of this famous apartment building look like they could lose it all.

French aristocrats the Wendels forced to put North Sea assets on the block (Times Online):
THE Wendel family, one of France’s most prominent industrial dynasties – which once made cannons for Louis XIV – has put its North Sea oil company up for sale in a desperate bid to raise cash after debt-fuelled investments soured, threatening to make it one of the most high-profile casualties of the global financial crisis.

State employees stunned by request for $250 million in concessions (
COLUMBUS — The state has asked workers in its largest labor union to accept a 5 percent across-the-board pay cut, a shorter work week and unpaid holidays to help balance the state’s troubled budget, according to a document obtained by The Plain Dealer. The list of cuts and changes Gov. Ted Strickland’s administration has asked the workers to accept, which also includes mandatory furloughs and paying more for their health insurance, would amount to $250 million in concessions, according to a members-only e-mail from Ohio Civil Service Employees Association president Eddie L. Parks.

Eastern Europe braced for a violent ‘spring of discontent’ (Guardian):
Riots and street battles are set to spread through Bulgaria, Romania and the Baltic states as inflation, unemployment and racism fuel tension, reports Jason Burke

Obama team weighs government bank to ease crisis (Reuters):
(Obama team weighs government bank to loot taxpayers’ even more.)

Obama Bank Rescue May Make New Effort to Resolve Toxic Assets (Bloomberg)

VeraSun to put 7 plants up for auction (Forbes):
VeraSun Energy Corp., the nation’s second largest ethanol producer, is putting seven of its biorefineries up for auction as part of a bankruptcy court financing agreement.

Brown’s fury at Royal Bank of Scotland’s £2.5bn loan to Russian oligarch (Daily Mail)

Recession drills deep into oil and gas (Independent)

Gulf Shares Fall on Concern That Earnings May Lag Expectations (Bloomberg)

Oil demand to fall again in 2009 (BBC News):
(Oil demand dropped very little … compared to oil prices. This makes no sense whatsoever, unless what Lindsey Williams said is actually happening right now.)

Monetary union has left half of Europe trapped in depression (Telegraph)

Iraq reconstruction’s bottom-line (Asia Times)

UK is in freefall, warns think-tank (Guardian)

Florida’s Nadel Missing as FBI, SEC Investigate Funds (Bloomberg)

GAO: 83% of big U.S companies, contractors use offshore tax havens

Citigroup – which has received $25 billion from the bailout fund, plus $300 billion in government guarantees – has set up 427 tax haven subsidiaries to do business: 91 in Luxembourg, 90 in the Cayman Islands and 35 in the British Virgin Islands. Other havens include Switzerland, Hong Kong, Panama and Mauritius.”

The Government Accountability Office (GAO) has just issued a report showing that most of the nation’s largest public companies and government contractors rely on offshore subsidiaries to do business and cut their tax bills. Some of these same firms – including big banks and insurers – have already received tens of billions in taxpayer money from the federal bailout fund.

Citigroup, Bank of America, Morgan Stanley, American International Group, American Express have set up hundreds of tax-haven subsidiaries, the report states. All have taken billions from the bailout fund. Pepsi and Caterpillar, both of which have received billions in tax dollars from being major government contractors, also shelter revenue in offshore subsidiaries, The Washington Post says.

Read moreGAO: 83% of big U.S companies, contractors use offshore tax havens

No evidence Madoff traded a single share for clients, says regulator

  • Watchdog has examined books since 1960
  • Statements showing trades now look fictitious

The mystery surrounding Bernard Madoff’s $50bn Ponzi scheme deepened further last night as it emerged there was no evidence the alleged fraudster traded a single share on behalf of his clients.

America’s financial industry regulatory authority, told the Guardian that in more than 40 years examining the books of Madoff’s brokerage, investigators never saw a share traded on behalf of his investment advisory business.

Madoff is said to have confessed that his investment business was a Ponzi scheme that siphoned $50bn from friends, charities and thousands of others. The brokerage, meanwhile, was a legitimate business trading shares wholesale on behalf of investment banks, mutual funds and other institutions.

“Our investigations of Bernard Madoff’s broker dealership showed no evidence that any shares were ever traded on behalf of his investment advisory business,” a spokesman for Finra said, adding that the regulator had been looking at his books since 1960.

Read moreNo evidence Madoff traded a single share for clients, says regulator

60 Minutes: Speculation Affected Oil Price Swings More Than Supply And Demand

The Price Of Oil: The historic swings in oil prices last year were the result of financial speculation from Wall Street and not supply and demand. Steve Kroft investigates.

(CBS) About the only economic break most Americans have gotten in the last six months has been the drastic drop in the price of oil, which has fallen even more precipitously than it rose. In a year’s time, a commodity that was theoretically priced according to supply and demand doubled from $69 a barrel to nearly $150, and then, in a period of just three months, crashed along with the stock market.

So what happened? It’s a complicated question, and there are lots of theories. But as correspondent Steve Kroft reports, many people believe it was a speculative bubble, not unlike the one that caused the housing crisis, and that it had more to do with traders and speculators on Wall Street than with oil company executives or sheiks in Saudi Arabia.

To understand what happened to the price of oil, you first have to understand the way it’s traded. For years it has been bought and sold on something called the commodities futures market. At the New York Mercantile Exchange, it’s traded alongside cotton and coffee, copper and steel by brokers who buy and sell contracts to deliver those goods at a certain price at some date in the future.

Read more60 Minutes: Speculation Affected Oil Price Swings More Than Supply And Demand

Two more Ponzi schemes uncovered

The US Government moved to clamp down on fraudulent Ponzi schemes in the wake of the $50 billion (£33 billion) Bernard Madoff scandal, by charging two men for allegedly operating two similar schemes.

The US Securities and Exchange Commission (SEC) charged a fund manager based in the Philadelphia area with operating a $50 million Ponzi scheme, in which he paid off early investors with money from later investors.

In a joint filing, the SEC and the Commodity Futures Trading Commission allege that Joseph Forte, 53, reported consistently strong results to as many as 80 investors even though he routinely lost money, withdrew millions of dollars in personal fees and used recent investors’ contributions to repay earlier backers.

In a separate case, the SEC and the Department of Justice charged Richard Piccoli, an 82-year-old, with running a Ponzi scheme through his companies, Gen See Capital Corp and Gen Unlimited. Mr Piccoli, of Williamsville, New York, raised most of his money from clergy, Catholic parishioners, senior citizens and cemetery funds, many of them recruited through advertisements in Catholic newspapers.

Read moreTwo more Ponzi schemes uncovered

Madoff whistleblower wants to be left alone

‘Madoff’ could have only happened because there are criminals all over the place.
See also: Madoff Scheme Was ‘Impossible’ to Do Alone, Says EIM’s Busson

Bernard Madoff (R) is escorted from Federal Court in New York January 5, 2009.

BOSTON (Reuters) – After a decade of trying to convince U.S. authorities that Bernard Madoff’s seemingly high-flying hedge fund was a scam, the man whose warnings could have saved a lot of money for a lot of people issued a terse message to the world: Leave me alone.

He will talk to Congressional investigators and that’s it.

Madoff stunned the world in December when he allegedly admitted to running a “giant ponzi scheme” that investigators have said cost investors $50 billion. In a ponzi scheme, money from new investors is used to pay back earlier investors.

Many people were fooled, but not Harry Markopolos, the 52-year-old former financial executive who had been onto Madoff since 1996.

Members of Congress have repeatedly invoked Markopolos name in questions to the U.S. Securities and Exchange Commission about how it missed the $50 billion fraud.

“Why in the world didn’t anyone respond to his allegations?” asked Rep. Carolyn Maloney, a New York Democrat, referring to a 19-page memo Markopolos wrote to the SEC in 2005 titled, “The World’s Largest Hedge Fund is a Fraud.” Maloney asked during a Congressional hearing: “What happened to his report?”

Read moreMadoff whistleblower wants to be left alone

SEC Examines More Ponzi Schemes After Madoff

Jan. 2 (Bloomberg) — U.S. regulators working to untangle Bernard Madoff’s alleged $50 billion Ponzi scheme are probing other money managers suspected of using similar tactics, two people with knowledge of the inquiries said.

Related article:
Whistleblower document warned SEC in Nov. 2005 about Madoff’s Ponzi scheme

The U.S. Securities and Exchange Commission is pursuing at least one case in which investors may have been cheated out of as much as $1 billion, according to a person, who declined to name the manager and asked not to be identified because the probe isn’t public.

Read moreSEC Examines More Ponzi Schemes After Madoff

Whistleblower document warned SEC in Nov. 2005 about Madoff’s Ponzi scheme

Pam Martens worked on Wall Street for 21 years; she has no security position, long or short, in any company mentioned in this article:

I seldom have the urge to give a comforting pat on the back to people profiled in the Wall Street Journal.  But that was my reaction when I read the 21-page whistleblower document about Madoff that was written by Harry Markopolos to the Securities and Exchange Commission (SEC) on November 7, 2005. The Journal still has the document on its web site and Markopolos provides a step by step plan for the SEC to follow to nail Madoff as a Ponzi fraudster. The letter followed a five-year effort by Markopolos, who supplied documentation and made repeated requests to the SEC to investigate Madoff.

Here’s how the SEC characterized the letter from Markopolos  in a January 4, 2006 memo: “The staff received a complaint alleging that Bernard L. Madoff Investment Securities LLC, a registered broker-dealer in New York (“BLM”), operates an undisclosed multi-billion dollar investment advisory business, and that BLM operates this business as a Ponzi scheme.  The complaint did not contain specific facts about the alleged Ponzi scheme…”

Here’s a tiny sampling of what Markopolos told the SEC in his 21-page November 7, 2005 letter.  You decide if these are “specific facts.”

“I am a derivatives expert and have traded or assisted in the trading of several billion $US in options strategies for hedge funds and institutional clients…(Highly Likely) Madoff Securities is the world’s largest Ponzi Scheme…The [Madoff] family runs what is effectively the world’s largest hedge fund with estimated assets under management of at least $20 billion to perhaps $50 billion…The third parties organize the hedge funds and obtain investors but 100% of the money raised is actually managed by Madoff Investment Securities, LLC in a purported hedge fund strategy.  The investors that pony up the money don’t know that BM [Bernie Madoff] is managing their money…Some prominent US based hedge fund, fund of funds, that “invest” in BM in this manner include: A. Fairfield Sentry Limited (Arden Asset Management) which had $5.2 billion invested in BM as of May 2005…Access International Advisors…which had $450 million invested with BM as of mid-2002…Tremont Capital Management, Inc…Tremont oversees on an advisory and fully discretionary basis over $10.5 billion in assets.  Clients include institutional investors, public and private pension plans, ERISA plans, university endowments, foundations, and financial institutions, as well as high net worth individuals…Madoff does not allow outside performance audits.  One London based hedge fund, fund of funds, representing Arab money, asked to send in a team of Big 4 accountants to conduct a performance audit during their planned due diligence.  They were told ‘No, only Madoff’s brother-in-law who owns his own accounting firm is allowed to audit performance’…Only Madoff family members are privy to the investment strategy.  Name one other prominent multi-billion dollar hedge fund that doesn’t have outside, non-family professionals involved in the investment process.  You can’t because there aren’t any…There are too many red flags to ignore.  REFCO, Wood River, the Manhattan Fun, Princeton Economics, and other hedge fund blow ups all had a lot fewer red flags than Madoff and look what happened at those places…”

Here is what the SEC’s memo of November 21, 2007 said following its investigation:

“The staff found no evidence of fraud…All files have been prepared for closing…Termination letters have been sent to Bernard L. Madoff Investment Securities LLC, Bernard L. Madoff, and Fairfield Greenwich Group.  The staff has no objection to the eventual destruction of the files and has no knowledge of any impediment to such a disposition.”

Let me run that by you again.  Mr. Markopolos, a private citizen, uses his personal time and energy over a seven year period to document a fraud occurring under the nose of the SEC that could impact the international reputation of the United States along with the financial well being of pensioners, university endowments, foundations and private investors.  After losing track of the case for five years, the SEC finally gets around to investigating using taxpayers’ monies.  They come up with nothing despite being given a perfect path to follow to the fraud.  And their final suggestion for dealing with the investigation is to destroy the files!  With regulators like these, who needs Ponzi artists?

Read moreWhistleblower document warned SEC in Nov. 2005 about Madoff’s Ponzi scheme

SEC ignored Madoff warnings for 10 years

The world’s biggest fraud could have been averted if the Securities and Exchange Commission (SEC) had acted on numerous warnings about Bernard Madoff’s financial impropriety years ago, the regulator’s chairman admitted last night.

Christopher Cox, the chairman of the SEC, effectively admitted mea culpa over the scandal after conceding that tip-offs were repeatedly made to the investors’ watchdog but never resulted in any investigation.

Related article: SEC Official Married into Madoff Family

Mr Cox said that in less than a week of checks made into the regulator’s oversight of investment businesses run by Bernard Madoff, he had found that “credible and specific allegations” had been “repeatedly” brought to the attention of the SEC but that no recommendations had ever been made to investigate the accusations.

The admission comes a week after Bernard Madoff, a 70 year old financier, admitted to his two sons that he was “finished” and that his investment firm was nothing more than a giant Ponzi scheme.


He also admitted to his sons, who worked for him, that he believed that losses arising from his financial wrong-doing amounted to around $50 billion, representing the biggest fraud in history.

Related article:
Madoff put under house arrest – in $7m apartment (That is called justice.)

His investment firm, which has since been forced into liquidation, has triggered billions of dollars worth of losses among the world’s biggest financial institutions, charities, state pension schemes, and personal savings.

Read moreSEC ignored Madoff warnings for 10 years

Madoff Scheme Was ‘Impossible’ to Do Alone, Says EIM’s Busson

Yes, it is impossible to do this alone. Especially because…
Unlike most hedge funds, Madoff’s business was regulated by the SEC, giving investors an added layer of protection, Busson said.

“I knew the SEC was all over this shop. As a broker-dealer, you file quarterly statements,” he said. “The main reason we got comfort is that it was SEC-regulated, and it was doing 10 percent of the volume on the New York Stock Exchange and Nasdaq.”

But here comes the next biggie: SEC failed to inspect Bernard Madoff fund (The Telegraph):
Last night Bloomberg reported that The Securities and Exchange Commission hasn’t examined the hedge fund since he registered the unit with the agency in September 2006.

So he had help. 🙂

Dec. 16 (Bloomberg) — Bernard Madoff’s alleged Ponzi scheme, which might have cost investors $50 billion, couldn’t have been carried out alone, said Arpad ‘Arki’ Busson, chairman and founder of Swiss investment firm EIM SA.

“For the amount of money and number of accounts, it’s practically impossible that he was doing this alone,” said Busson, whose $11.5 billion fund of hedge funds had about $230 million invested with Madoff. “What’s mind-boggling is the amount of assets and the amount of time he was doing it.”

Read moreMadoff Scheme Was ‘Impossible’ to Do Alone, Says EIM’s Busson

Former Nasdaq Chairman Madoff Confessed $50 Billion Fraud Before FBI Arrest

Dec. 12 (Bloomberg) — Bernard Madoff confessed to employees this week that his investment advisory business was “a giant Ponzi scheme” that cost clients $50 billion before two FBI agents showed up yesterday morning at his Manhattan apartment.

“We’re here to find out if there’s an innocent explanation,” Agent Theodore Cacioppi told Madoff (The FBI ‘should’ be there to find out the truth, not an ‘innocent explanation’.), who founded Bernard L. Madoff Investment Securities LLC and was once chairman of the Nasdaq Stock Market.

“There is no innocent explanation,” Madoff, 70, told the agents, saying he traded and lost money for institutional clients. He said he “paid investors with money that wasn’t there” and expected to go to jail. With that, agents arrested Madoff, according to an FBI complaint.

Read moreFormer Nasdaq Chairman Madoff Confessed $50 Billion Fraud Before FBI Arrest