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Will Bailout Money Save Madoff or Wall Street Ponzi Scams

December 17, 2008

Some Wall Streeters As Corrupt As Illinois Governeror

At least the Big Three Auto Companies produce something more than paper

By Jeffrey Jolson

HOLLYWOOD(RushPRNews/Hollywood Today) 12/16/08 — People are wondering where their $700 billion tax money bailout from the Bush Administration to the money market is going - or needed in the first case. Well the former chairman of NASDAQ Bernard Madoff has boasted to oversight group SEC about his alleged $50 million “Pyramid” scam. How are we to trust Wall Street now? A sound Wall Street is always needed, but is it corrupt as the Illinois Governor’s office?

The money manager Madoff is accused of duping investors in one of Wall Street’s biggest Ponzi schemes once boasted to the Securities and Exchange Commission about how much money he earned and formally advised the U.S. government on ways to protect investors from scam artists.
Alleged victims include the family charitable foundation for Sen. Frank Lautenberg, D-N.J.; a trust tied to real estate magnate Mortimer Zuckerman; and a charity of movie director Steven Spielberg. The Wall Street Journal reported DreamWorks Animation SKG Inc. Chief Executive Jeffrey Katzenberg and the foundation of Nobel laureate Elie Wiesel also took hits, according to AP.

As the scale of the alleged scheme was realized, attention turned quickly to Madoff’s connections to Washington regulators responsible for monitoring investment funds like the one Madoff operated. He knew everyone, former SEC chairman Arthur Levitt said in an interview with The Associated Press. Levitt said he did not invest any money with Madoff.

The director for enforcement at the SEC, Linda Thomsen, said the government was working with federal prosecutors and the FBI to understand the case, “to pursue the case we’ve got, to preserve assets to the extent we were able and to bring everyone who was responsible for the conduct at the Madoff firm. It’s justice,” she said Monday.

At one SEC hearing in April 2004 - during the period when Madoff is accused of carrying out his $50 billion fraud - Madoff joked with then-commission chairman William Donaldson about Madoff’s own extraordinary profits and teased that he wasn’t inclined to provide any advice that might help his business rivals.

“Our firm has made a fairly decent living as a fast market competing with a slow market,” Madoff said, “so I’m not sure it’s in our own best interest for everyone to become a fast market.” Commissioners laughed openly as Madoff agreed “to take off our selfish hats here and speak for the public good.”

As a former Nasdaq chairman, Madoff was an expert sought by Washington regulators who asked for advice on any number of regulatory issues over the years. In 2000, Madoff served on the government’s Advisory Committee on Market Information, established to protect investors by ensuring accurate and full public disclosure of information to them.

Financial analysts raised concerns about Madoff’s practices repeatedly over the past decade, including one letter to the SEC as early as 1999 that accused Madoff of running a Ponzi scheme, but the agency did not conduct even a routine examination of the investment business until last week, The Washington Post reported on its Web site Monday night.

Questions have been raised in two earlier cases about the SEC’s handling of investigations involving influential figures on Wall Street or powerful investment firms.

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