Madoff Employee Breaks Silence

[kpete]

Source: Daily Beast

Madoff Employee Breaks Silence

by Lucinda Franks

In a Daily Beast exclusive, one of the fraudster’s employees tells Lucinda Franks that the supposedly legitimate brokerage operations were in fact just money-losing fronts for the fraudster's scheme. Plus, what Madoff’s sons told staff the day after Bernie’s arrest, trips to the company’s secretive 17th floor, Bernie’s obsession with the color black and employee neatness, the roles of other family members, and visits to the founder’s Montauk home.

An employee who worked in Madoff’s legitimate brokerage operations, described by the fraudster in his plea agreement as being “successful and profitable,” has told The Daily Beast that they were in fact money losers that acted as a front for his Ponzi scheme.

He said that the legitimate businesses, the proprietary and market making arms on the eighteenth and nineteenth floors of Madoff Securities were designed to lure investors in, especially highly-placed figures in society, and to fool the SEC into thinking that he had a large and impressive galaxy of businesses.

But behind the façade, these so-called legitimate businesses were a shambles. They were excessively staffed with grossly overpaid people, and run with marked inefficiency, he said.

Read more: http://www.thedailybeast.com/blogs-and-stories/2009-03-19/madoff-employee-breaks-silence/

[Manifestor_of_Light]

1. Sounds like the fake trading floor at Enron that they used as a front.

What a tangled web we weave.....

[Blackhatjack]

3. It does remind me of Enron and their tactics, the more we learn ....

How in the world is anyone going to believe that so many people working for him didn't have a clue as to what was really going on?

There is some 'dirty money' and political influence hidden here... almost guaranteed. And if there is a legitimate investigation those in govt and the SEC who gave cover will be in the firing line.

[willing dwarf]

2. Are you sure this wasn't AIG or one of the swindle banks he's describing?

They were excessively staffed with grossly overpaid people, and run with marked inefficiency, he said.

[Demeter]

10. Modern Management as Taught By American Business Schools

[defendandprotect]

4. Brokerage operations: just money-losing fronts for the fraudster's scheme

Amazing . . .

and no one noticed?

Unregulated capitalism is merely organized crime!

[aquart]

5. None of the money adds up. This is way past weird.

[Gin]

8. this part is a clue....

Shana Madoff , the compliance legal counsel, Peter’s daughter who was married to an SEC compliance officer, only spent half time in the office. When she was here, she seemed to work on Human Resources rather than compliance.”

[aquart]

9. That explains the blind eye. It doesn't add up the money.

And what really makes me nuts, not a sign of nervousness or worry from any of them in all that time. Me, I would have been mainlining antacids.

[willing dwarf]

13. Madoff must have had incredible drugs or charisma

to create such a sense of complete control among his family insiders. Either that or maybe there's a genetic predisposition to show no fear. Or perhaps they were raking in so much money, they used it to by massive amounts of cocaine or whatever is the latest version of the make feel nice, fear not type drug. Seems to me they were all on something, and I'm sure they had the money for it!

[Skink]

6. How could an investors not notice.

some of them must have been paying attention to their statements and saying this can't be right.

[No Elephants]

11. Would have made no difference if they noticed. Someone did, and hammered on the SEC

repeatedly, laying out the entire thing for the SEC more than once. The SEC did nothing.

Remember De-Regulatin' Ronnie's "worst nightmare?" "I'm from the government and I'm here to help?" Well, the SEC did not give anyone that nightmare. I'm sure Madoff and Stanford's investors are grateful. (Neither does the FDA, apparently. Got melamine milk?)

I sure do wish that Democrats were doing a better job connecting the dots for the voting public. Instead, they leave everyone focused on AIG bonuses. Republicans just do so much better with p.r. for themselves.

[mikeytherat]

12. Christopher Cox and the SEC investigated Madoff not once, not twice, but EIGHT times.

One investigation was specifically looking for evidence of a Ponzi scheme. They (claim they) found nothing.

"In bed together" doesn't even begin to describe it.

:mad:

mikey_the_rat

[kojak]

7. staffed by grossly overpaid people...

And how is this different from the rest of Wall St?

[BumRushDaShow]

14. Thank you kpete for posting this link

and article. It really helped to fill in a void of missing information! :thumbsup:

[skypilot]

15. bookmarking for later.

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