The Graveyard is growing in New York City and thereby the State:
Bear Stearn’s, Lehman Brother, AIG, Merrill Lynch, AIG, CitiBank, with Goldman and Morgan becoming regular banks, to get TARP funding) see http://www.mdjonline.com/content/index/showcontentitem/area/1/section/16/item/123789.html
Now Bernand L. Maddoff Investment Securities LLC admits running a $50 Billion dollar self described ” PONZI SCHEME”
As a cop I can tell you this ” his son’s turned him in ” I assure you there will be plenty of co -conspirators, and persons who aided and abetted in this matter. However the New York Times is reporting that initial reports suggest he worked alone. see http://www.nytimes.com/2008/12/16/business/16madoff.html?partner=permalink&exprod=permalink If they are not place in jail and prosecuted, it will be prima farce evidence that America is on life support.
The Maddof scandal see ( http://www.ft.com/cms/s/0/2b38a296-cadc-11dd-87d7-000077b07658.html?nclick_check=1 is another example of a terrible fact for New York City and State. It will be years if ever does recover that New York City returns to be the world financial capital. In the immediate future the reckless and fraudulent conduct of Wall Street will cause New York City to experience many of the the 70’s toxic symptoms. See http://www.nytimes.com/2008/06/02/opinion/02krugman.html?partner=permalink&exprod=permalink
Cop, Fireman, Teacher, layoffs, decreased city services, and perhaps economic riots similar to what we are seeing in Greece. See my past articles here and http://www.independent.co.uk/news/world/europe/are-the-greek-riots-a-taste-of-things-to-come-1064479.html
The firm has shut down it’s web site but the Judicial order may be seen here http://www.madoff.com/letters/Signedorder.pdf The Judge ordered an emergency restraining order against this firm and it’s owner . The law reads ”
Section 206 — Prohibited Transactions by Investment Advisers
It shall be unlawful for any investment adviser, by use of the mails or any means or instrumentality of interstate commerce, directly or indirectly–
- to employ any device, scheme, or artifice to defraud any client or prospective client;
- to engage in any transaction, practice, or course of business which operates as a fraud or deceit upon any client or prospective client;
As both a police officer and an attorney I am saddened that society has become ignorant, dismissive,reckless,and disregarding “FACTS”. How could investors some sophisticated individuals and fims be so reckless in giving the man so much money.
Here is the biggest fact and red flag:
Maddoff didn’t use a reputable accounting firm Big 8, they had a back room outfit ” As I say, there were enough warning signals, including the fact that Mr Madoff’s auditors were a one man and his dog operation housed in a 13ft by 8ft office in Rockland County, New York. See http://www.independent.co.uk/news/business/comment/jeremy-warner/jeremy-warner-investors-should-have-looked-at-madoffs-golf-scores-1135374.html
How could pension funds, and sophisticated money managers accept the audits of this outfit? This alone is gross negligence and or a willingness to close your eyes to possible improper activities in exchange for higher returns. Pure Greed.
Second Warning Sign, the firm ran investment advice and trading in the same building separated only by one floor. Bernie grew his firm by developing a money management business alongside his broker-dealer business. Most major Wall St. firms do have these separate lines of business but by regulation they need to have very strict “Chinese Walls” in place to make sure that customer interests are protected and that insider trading does not occur. The fact that these two separate lines of business were one floor apart in the same office building for Bernard Madoff should have been a major warning signal for the regulators at the SEC and FINRA.” see http://www.noquarterusa.net/blog/2008/12/14/how-bernie-madoff-with-50-billion/
Another fact is that Maddoff was part of the Elite Jewish Community, and as such people of his faith ” trusted him” because of their similar beliefs. See: http://www.jewishjournal.com/thememo/item/madoffs_injurious_ties_to_yeshiva_university_and_the_jewish_community_20081/
The primary reason that world wide assets ,savings, investments, were invested in the United States was the belief and opinion that our nation could be ” trusted’. The entire pension system for Cops and Fireman in Connecticut may be gone see http://www.reuters.com/article/governmentFilingsNews/idUSN1552227920081216
America was trusted because the world assumed wrongfully the we had the proper checks and balances in place to stop fraud. Chiefly the ( SEC, ATTORNEY GENERAL, FDIC, SPIC, FBI and Judicial System) to protect and vigilently safeguard the worlds funds. Funds that included ( pension savings, insurance firm reserves, non for profit health care and educational endowments.
The SEC http://www.sec.gov/ is impotent. Why, the head of the SEC remains is beyond me. Here is their mission statement ” The mission of the U.S. Securities and Exchange Commission is to protect investors, maintain fair, orderly, and efficient markets, and facilitate capital formation.”
It seems as though as we played world cop, the bandits were on the lose here unchecked and certainly unrepentant.