'SEC Whistleblower Speaks on Madoff FraudMonday 22 December 2008
by: Matt Renner, t r u t h o u t Report
"In today's regulatory environment, it's virtually impossible to violate rules ... and this is something the public really doesn't understand ... but it's impossible for you to go - for a violation to go undetected. Certainly not for a considerable amount of time."-Bernard L. Madoff, just over a year before turning himself in for perpetrating what may prove to be the largest financial fraud in history.
After the revelation of a massive fraud scheme, a former government investigator has accused government law enforcement officials of repeatedly turning a blind eye to Wall Street crime and, in doing so, allowing the foundational trust of the global financial system to crumble.
The Securities and Exchange Commission (SEC), the oversight body which was set up to enforce laws regulating finance in order to prevent a repeat of the stock market crash of 1929, has admitted to falling down on the job, missing the long-running scheme allegedly perpetrated by Bernard L. Madoff - potentially the largest scandal ever to rock Wall Street.
Madoff, a 70-year-old Wall Street icon, turned himself into authorities after allegedly scamming investors out of up to $50 billion, using what appears to be a decades long "Ponzi" scheme, where money from new investors is used to pay off previous investors. The scheme collapsed because new victims could not be found and investors started to ask for their money back. Madoff could not return their funds because the money was gone and there were no real assets to sell. The details of exactly where the estimated $50 billion went are still unclear, but victims ranging from wealthy individuals to charities to foreign banks have all stepped forward to admit losses totaling approximately $20 billion to date.
On Tuesday, SEC chairman Christopher Cox admitted that the agency had failed to thoroughly investigate multiple "credible and specific allegations regarding Mr. Madoff's financial wrongdoing," adding "I am gravely concerned by the apparent multiple failures over at least a decade to thoroughly investigate these allegations or at any point to seek formal authority to pursue them."
The Madoff affair is the latest in a string of missteps made by the regulatory body.
Gary Aguirre on the SEC'
The Securities and Exchange Commission (SEC), the oversight body which was set up to enforce laws regulating finance in order to prevent a repeat of the stock market crash of 1929, has admitted to falling down on the job, missing the long-running scheme allegedly perpetrated by Bernard L. Madoff - potentially the largest scandal ever to rock Wall Street.
Madoff, a 70-year-old Wall Street icon, turned himself into authorities after allegedly scamming investors out of up to $50 billion, using what appears to be a decades long "Ponzi" scheme, where money from new investors is used to pay off previous investors. The scheme collapsed because new victims could not be found and investors started to ask for their money back. Madoff could not return their funds because the money was gone and there were no real assets to sell. The details of exactly where the estimated $50 billion went are still unclear, but victims ranging from wealthy individuals to charities to foreign banks have all stepped forward to admit losses totaling approximately $20 billion to date.
On Tuesday, SEC chairman Christopher Cox admitted that the agency had failed to thoroughly investigate multiple "credible and specific allegations regarding Mr. Madoff's financial wrongdoing," adding "I am gravely concerned by the apparent multiple failures over at least a decade to thoroughly investigate these allegations or at any point to seek formal authority to pursue them."
The Madoff affair is the latest in a string of missteps made by the regulatory body.
Gary Aguirre on the SEC'
Lees verder: http://www.truthout.org/122208J
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'Ladies and gentleman, we've got him'
Merijn
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