Madoff ‘Tragedy’ Said to Have Escaped Scrutiny by SEC

[Cronopio]

Source: Bloomberg

Dec. 15 (Bloomberg) -- U.S. regulators never inspected Bernard Madoff’s investment advisory business, alleged to be a Ponzi scheme that cost investors $50 billion, after he subjected it to oversight two years ago, people familiar with the case said.

The Securities and Exchange Commission hadn’t examined Madoff’s books since he registered the unit with the agency in September 2006, two people said, declining to be identified because the reviews aren’t public. The SEC tries to inspect advisers at least every five years and to scrutinize newly registered firms in their first year, former agency officials and securities lawyers said.

Madoff, 70, who had advised the SEC how to regulate markets and donated regularly to politicians, was arrested Dec. 11 and charged with operating what he told his sons was a long-running Ponzi scheme in the New York-based firm’s business advising rich people, hedge funds and institutions. His ability to avoid detection may fuel debate about the SEC’s effectiveness and the adequacy of its resources for policing money managers.

“Given what the SEC claims is the magnitude of the fraud, this is something you would hope an inspection would have uncovered,” said Mercer Bullard, a University of Mississippi law professor and former mutual-fund attorney at the SEC. “It’s hard to imagine a fraud of this alleged size not being accompanied by significant and pervasive compliance problems.” ...

Read more: http://www.bloomberg.com/apps/news?pid=20601087&sid=a3T.FJ8oI5hI&refer=home

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"Don't worry about checking up on him. He's one of us." *wink* *nod*

[boomerbust]

1. Oh yes

Another addition to the Bush pardon list.

[DUlover2909]

2. Anyone that steals 50 thousand million dollars, and then loses it,

and can't pay the money back, and admits it, and all the evidence is plainly obvious, should be executed.

[tama]

11. Madoff

didn't steal it alone. Other "investors" near the top of the pyramid also got huge returns.

Whole financial economy is a pyramid fraud. I agree that all the bankster-fraudsters should be executed, starting from board of Federal Reserve, but not forgetting the economical team of Obama.

[LuckyLib]

3. The Madoff scandal will be the smoking gun for the failure of Wall Street to be trusted by the

citizens of the country. When you can scam this many people, for these huge sums, EVEN WHEN the RED FLAGS were up, then the system is broken. Sons-a-bitches.:grr:

[Sadie5]

5. Have the already seized his assets?

Is he going to get away with his property and offshore accounts?

[Cronopio]

9. The era of dominance for the American financial system is over. Right now.

The greedheads screwed up the best thing that ever happened to them. Now they get to try to deal with the totalitarian Chinese government and the totalitarian Saudis and the royally pissed-off Germans and British, all of which have lost large amounts of money because of their little scams. I wonder how well that bodes for future deals.

[antimatter98]

4. Notice how, when the rich get ripped off it is NEWS.

Forget about the average worker who has his/her 401K decimated, or pension vanish.
THAT isn't news.

If we don't reform Congress, no one else will.

[KansDem]

12. And a "tragedy" no less...

I mentioned this to my wife this morning. Madoff's "investors" were victims, yet if this had been average, middle class types, then I wouldn't have been surprised if there had been a "shoulda' known better" tint to the reporting...

[MannyGoldstein]

6. I've Suspected That There Are A Lot Of These Situations

This may be the first of many.

[Cronopio]

8. He had to admit to it to be nabbed. So I'm sure there are more people out there like him. nt

[dugaresa]

7. you dress well, you spread money around Washington and you

talk up your success..and you can start robbing folks of their savings...and I won't be suprised if he walks on this or gets probation cuz of his age

[Cronopio]

10. People like GW Bush and Bernard Madoff give every slick sociopath in the world ...

... supreme confidence and hope. As long as people believe in the sacred cows of privilege, reputation, and position, they know that the people they screw over won't suspect them. And even some of those who do will still defend their position to keep the system intact.