Bernie Madoff Targets Banks and Hedge Funds: “They Had to Know” (via Sense On Cents)

Larry Doyle

From Larry Doyle’s Blog, Sense on ¢ents:

Bernie Madoff deserves zero sympathy and less attention. On the other hand, those seriously impacted by his crimes deserve not only sympathy but also recompense. Irving Picard, the trustee pursuing that recompense on behalf of Madoff investors, is making some high profile claims and has generated substantial results. That said, selected Madoff investors have informed me that they give Picard very mixed reviews.

Doyle goes on to discuss Madoff’s recent comments that others had to know about what he was doing. Doyle believes like me that it is not possible to move that kind of money around without someone realizing that something was wrong.

The article continues –

I have no doubt that the Wall Street banks and a variety of hedge funds knew, should have known, or did not want to know what was truly transpiring within Madoff’s operation.

But, let’s go deeper than that. Who is charged with keeping these banks honest? What about the regulators? Not that Bernie has any real credibility, but why isn’t he compelled to provide further testimony about those who regulated his enterprise, specifically the NASD, its offspring FINRA, and the SEC?

Right. How come the various federal agencies are not investigating this?

Because they don’t want to.

Because it would be embarrassing.

Because there would be political fallout.

It wouldn’t stop the feds from putting any of us in jail but assisting Madoff is no big deal because it wasn’t done by people like “us.”

James Pilant

Tom Petters – 3.5 billion not small change

109-1Tom Petters – 3.5 billion not small change

Generally speaking few people begin a life of crime suddenly and without warning. Usually there are many small crimes and a certain “casualness” toward the accepted standards of society.

Tom Petters’ trial in Minnesota on hedge fund fraud (Ponzi scheme) begins this week.

Let me quote from the Wall Street Journal article:

In high school in Minnesota, he started a business selling stereo equipment to students at a local university, but his parents shut him down after learning he was skipping school. He later dropped out of college to work for an electronic retailer, but he was so broke in 1988 that he had to move in with his brother, Jon.

Add in a divorce, a stint in cocaine rehab, and involvement in multiple breach-of-contract lawsuits with business partners, both as a defendant and plaintiff.

There were plenty of warnings if someone was willing to look. Am I saying that people cannot turn their lives around? Certainly not. But I don’t believe in living with your eyes closed either. 

James Pilant