2009-07-29 19:05:31
Bernard Madoff Can't Believe That The SEC Didn't Nail Him Years Ago
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In yet another black eye for the SEC, Bernard Madoff recently revealed in a jailhouse interview that he couldn't believe that his multi-billion dollar fraud lasted for as long as it did.
Two lawyers who represent about a dozen Madoff victims recently conducted a 4 1/2 hour interview with the notorious swindler during the first days of his lengthy prison sentence. The 71 year-old Madoff is currently serving out a 150-year prison sentence in a federal prison in Butner, North Carolina.
Madoff reportedly expressed remorse and repeatedly apologized for robbing thousands of investors of their hard-earned money.
In addition, Madoff reportedly revealed to the lawyers in attendance that he was "shocked" that his scheme wasn't uncovered earlier.
In yet another crushing indictment of the SEC, Madoff revealed that "there were several times that I met with the SEC and thought 'they got me'".
Bernie Madoff whistleblower Harry Markopolos pleaded with the SEC for years to thoroughly investigate Madoff and his company. Markopolos was certain that Madoff was up to no good, and provided plenty of evidence to the SEC that backed up his suspicions.
The SEC had multiple chances to shut down Madoff's scheme long ago, which would have ended up saving literally tens of billions of dollars in lost investor money.
Markopolos first smelled a rat in the late '90s and asked the SEC to investigate Madoff.
The SEC did nothing.
In 2001, Markopolos actually had a meeting with an SEC official. In this meeting, Markopolos asserted in no uncertain terms that Madoff was a fraud, and that a thorough investigation of Madoff's company would prove that he was right.
In 2005, Markopolos sent a very thorough document to the SEC, outlining all of the reasons why he thought that Bernard Madoff was perpetrating a fraud.
In 2007, acting on information that was supplied by Markopolos, the SEC investigated Madoff and didn't find any evidence that he was operating a "Ponzi scheme".
In late 2008, Harry Markopolos was proven to be 100% correct, and the Madoff swindle finally unraveled. But by then, it was too late, and billions of dollars had already been flushed down the toilet.
Markopolos looked like a genius while the SEC looked anything but.
Was the SEC just really incompetent in not being able to sniff out this fraud? Or was something more sinister taking place?
In any case, the SEC missed multiple opportunities to nail Bernard Madoff. Given the magnitude of the fraud that Bernard Madoff perpetrated, you would have to think that the SEC could have easily detected that something wasn't right if they had spent just a little time investigating.
Even Bernard Madoff can't believe that the SEC didn't uncover his scheme.
Could the SEC look any worse if they tried?
Source: Reuters - Madoff: Can't Believe Fraud Lasted So Long
Filed under: Hedge Fund News
2 COMMENTS - What Say You?
Comment by Monique on July 29, 2009 @ 11:26 pm
No, the SEC couldn't look any worse. My question is, what should change and will it?
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Comment by Dave on July 30, 2009 @ 12:21 am
First step - the SEC needs to hire less lawyers and more people with forensic accounting backgrounds I think.
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