Wexler: Let’s Aid Madoff Victims

[Purveyor]

South Florida Congressman Robert Wexler today called for Congress to help victims of Bernard Madoff’s allegedly fraudulent investment schemes.

Madoff is the Wall Street whiz accused of ripping off Jewish and other charitable groups through a Ponzi scheme.

Wexler, a Democrat from Boca Raton, called it another example of lax government regulation.

“We must be vigilant in investigating how Bernard Madoff was able to operate undetected for as long as he did and look at changes in our regulatory structure to prevent similar fraud,’’ he said.

``Though it is still early in the investigation, we must consider all options to help these investors, including special IRS guidance for those who have lost money or a special office to assist victims of the Madoff fraud.''

Wexler said he is talking with his colleagues about allowing defrauded investors to go back more than three years to deduct their losses.

http://weblogs.sun-sentinel.com/news/politics/dcblog/2008/12/wexler_lets_aid_madoff_victims_1.html

[lapfog_1]

1. uhhh, no.

Sorry you millionaires and billionaires. But nobody was taken advantage of who wasn't also very very greedy.

No investor with that kind of money should have had "all of their eggs in one basket".

And, primary rule for any investing... It it seems too good to be true, it probably is.

[DavidMS]

22. And it was marketed to supposedly sophisticated investors...

So any bailout should be limited to a single box of Kleenex. They should have known the risks. To do otherwise would encourage the creation of a Moral Hazard.

[valerief]

2. Yes, and let's aid the richest ones first, like we did with the banks. nt

[blueinindiana]

3. NO NO NO NO NO !

I am so sick of greedy assholes who lose money wanting their money back!

no matter what party they belong to!

Anyone who puts all their assets in to one thing and loses out that is their fault!

God I knew this was gong to happen!

[babylonsister]

4. "Let's" meaning our tax dollars at work to aid these unfortunate

investors? We're already doing that afaik, and I'm not in favor of it.

http://www.talkingpointsmemo.com/archives/2008/12/latest_madoff_v.php

Latest Madoff Victim: You
12.30.08 -- 1:17PM
By Josh Marshall

There's not much hope for people who lost their shirts on the Madoff scam. But you'll be happy to hear that some of them will recoup losses courtesy of your tax dollars.

I'd heard recently that among its other choice decisions, AIG (now a ward of the federal government) had managed to offer insurance for some of Benard Madoff's fraudulent investments. The dollar amounts aren't that high. So far AIG has received 85 claims for Madoff losses. And the individual policies only cover up to $100,000, though I'm told the policies were sometimes layered together in ways that could make the effective insurance limits much higher. What's more, a private insurance company can insure anything they want, be as stupid as they want to be.

But the fact that some of your tax dollars are going to go to people who lost money to Madoff does get us back to the premise of the government's take over of AIG, and to be specific, the highly questionable premise that AIG isn't simply bankrupt.

Remember, the idea of taking over AIG was that it had so much systemic exposure through the world of finance (through CDOs, credit default swaps, etc.) that letting it go under would just be too damaging to the macro-economy. In principle, that makes sense to me. But presumably there's no systemic damage involved in not paying out these Madoff claims. A lot of the hundred-fifty-plus billion dollars of US government money has simply been passed through to other banks like Goldman Sachs, Merrill Lynch, UBS, Deutsche Bank, etc.

As Carlos Mendez told the Wall Street Journal recently, "It's like a home run for some of the banks. They bought insurance from a company that ran into trouble and still managed to get all, or most, of their money back."

Will Goldman fail without the few more billion the government gave the bank through AIG? I doubt it. Will the taxpayer be made whole for covering the losses Goldman incurred by dealing with AIG? Of course not.

[MidwestTransplant]

5. They are all entitled to 500K under teh SIPC

[Phred42]

6. NO! Let's have free healthcare and social security FIRST!

[Dogmudgeon]

7. "Confidence"

From whence the term "Con(fidence) Man" comes.

Madoff did not offer particularly "too-good-to-be-true" returns on investment -- merely good returns. He suckered in a huge number of financially literate people. It was as solid, fool-proof, undetectable a scam as can be pulled these days. That is how he made his money.

But it wasn't 100% solid, fool-proof, and undetectable.

Aiding Madoff's victims is all well and good, but the entire COUNTRY is based on un-guaranteed investment. A huge chunk of our collective retirement savings is in the hands of legal con men -- pardon, "organizations of financial confidence". Even if the fraction of fraud is small, even a little puts the entire system at risk.

This is going to take more than a few bail-outs. It will require re-engineering the financial system, world-wide. And that could be a very good thing, indeed -- or a wealth grab of cosmic proportions.

--p!

[monmouth]

8. Wexler is waaaay off base here, no and hell no. Of course the folks

in his area and most likely his base, lost big time. They all tried to outdo each other and sorry to say Robert, that's not our fault. They knew it was a ponzi scheme, ignored it and collected their fat checks. Absolutely NO!

[SheilaT]

9. Please realize that not everyone

who lost money with Madoff is a rich person. Unless, of course, you include things like pension funds who (foolishly) invested with him.

But no, I don't think we should be bailing out any of those unfortunates, just as I don't think we should have bailed out the banks as we did, nor should we be bailing out the auto companies.

If anyone should be helped out (note I don't say bailed out) it's the ordinary person who has been laid off, or who was persuaded or allowed to take out a mortgage he or she clearly couldn't afford. People like that.

[acmavm]

10. The next handout of money should be to the American people, shouldn't

it? We're the only ones who haven't gotten a share yet.

[bertman]

11. They're his "constituents". Rest assured that most, if not all of them, knew the returns

he was bringing them were due to some type of, shall we say "anomaly", that other investors weren't benefiting from.

Play with fire, get burned.

Too bad.

But, if you're lining up folks to pay for losses in the market, I'd like to put my 401k on the list, please.

[natrat]

12. no fucking way

[Joanne98]

13. NO!!!!!!!!

[southernyankeebelle]

14. How Nobel but

Mr Wexler, why are the taxpayers suppose to bailout individual people that lost money with Madoff. Where were you standing when the employees of Eron lost everything including their pension. Hell no. You should help all or none.

[classysassy]

15. The Vagus

losers should also get some relief.

[IndianaGreen]

16. Let's not!

Enough of the bankers, financiers, speculators, and the parasitic investor class.

[kirby]

17. Keep in mind...

People paid taxes on phantom profits. They are entitled to refunds of taxes on capital gains they paid.

[IndianaGreen]

18. They should return the money they made

at the expense of newer investors in Ponzi scheme.

[kirby]

21. I believe that is the law...

No one really knows what money they made, if any. It will be a mess that will takes years to unravel. I think that is why Waxman doesnt want people to have to pay taxes on phantom profits only to wait 2 or 3 years for the process to tell them they get the taxes back.

[midnight]

19. Thank God the wealthy have a voice in Washington.

Now if only the working class fools could find someone to help with this mortgage rip off we were suckered into.

[Sherman A1]

20. Agreed

Maybe we should help out homeowners who are about to lose their homes first.