Madoff Had Accomplices: His Victims

[DainBramaged]

Standing in the security line Thursday morning, waiting to get into the federal courthouse in Manhattan, I started chatting with the man behind me. He looked to be in his early 60s, and though he was well dressed, he looked a little haggard. I asked him if he was a victim of Bernard L. Madoff, who would soon be pleading guilty to masterminding the greatest Ponzi scheme in history. He said he was.

Did he want to talk about it? He wasn’t sure, he said. I asked his name. “I’m not going to give my name unless there is some benefit for me,” he said dourly. “I haven’t had too many benefits lately.”

How much had he lost? I asked. He grimaced. “I don’t really want to say,” he replied, but conceded that it was a lot.

What was he hoping for today? He shrugged.

As we passed through security, I asked him what role he thought the government should be playing. It was as if I had flipped a switch. Suddenly, his reticence fell away.

“The S.E.C.,” he said, referring to the Securities and Exchange Commission, which muffed multiple opportunities to catch Mr. Madoff, “they played a big role in this. They have a lot to answer for.” He said that the tax code should be changed so that Madoff victims can recoup taxes they paid on profits that turned out to be illusory — no matter how far in the past those taxes were paid. He thought the Securities Investor Protection Corporation, which tries to put at least a little money in the hands of investors whose firms have gone under, should give victims more than the current $500,000 maximum.

“I think there should be some legislation,” he said finally. What kind of legislation? What he was hoping for, he said, was that the government would set up a fund for Madoff victims — maybe give them 60 percent of their losses, he suggested.

We turned a corner, and saw a long line of people waiting for a spot in the courtroom — far more people, it was obvious, than could ever fit in the chambers. (There was a large overflow room, where I watched the proceedings.) Most of them were holding notebooks; this was clearly the media line. “Is there a line for the victims?” the man asked the marshal.

“Are you a victim?” said the marshal. As the man nodded yes, the marshal said, “Come with me.” He took the man to the elevator and whisked him upstairs and directly into the courtroom.

http://www.nytimes.com/2009/03/14/business/14nocera.html?_r=1&hp (two page article).


<added>When you look at the list of Madoff victims, it contains a lot of high-profile names — but almost no serious institutional investors or endowments. They insist on knowing the kind of information Mr. Madoff refused to supply. (In spite of what some here tend to believe.)

[BeFree]

1. Heh

All these poor suckers trusted, TRUSTED the government to protect them from such thievery.

They depended on good government to protect them and their fortunes, yet bushco failed them in their neediest moments. That's the real crime.

[DainBramaged]

3. They TRUSTED during the Bushco misAdministration

which makes them double suckers.

[BeFree]

8. Double?

Nah, just once over. Since they heard that the SEC and whatnot was being paid good money to keep a watch on what was going down they figured no crooks could do what Madoff did, and they were right to think so.

It was the government that failed them. Madoff was just another in a long line of crooks that the government is supposed to control. Instead, the gov was out busting Iraqis, potheads, and other assorted terrorists.

The gov is the failure here and bushco was the government.

[sendero]

4. I damn sure don't feel sorry...

.. for anyone who expected Bush to protect anything.

[spanone]

blame the victim.....

silly

[liberalmuse]

2. Madoff is not long for this world.

One or more of his victims will try and take him out. This is not going to end well for him. He took away thousands of people's means of survival, and I don't think even the best security is going to protect him.

[LuckyLib]

5. And, Madoff's favorite charitable foundation, the Lymphoma Foundation, would not invest with him!

Smart people -- even if you're getting $$$ from a wall street fat-cat, you don't have to throw in your own foundation dollars.

Greed -- pure and simple greed. His quote says it all:
“I’m not going to give my name unless there is some benefit for me.”

[malaise]

6. I know a lot of people who were burned here in Jamaica

by two Ponzi rackets. You would think many of them would know better.
Like you I believe that when greed supercedes due dilegence, victims have to live with the consequences.

It's true that people assume that the government has regulations which protect them from scoundrels, but if all those people didn't realize that Bushco was the criminal in chief and there were no regulations, then they were both greedy and naive.

I hope Madoff's wife and children end up in prison as well, but I have no tears to shed for Ponzi victims anywhere on the planet. Put simply, earning ridiculous profits without work only happens when you play monopoly.

[david13]

13. 100%

Greedy and naive. I have no tears for them either.
dc

[liberalhistorian]

20. So you would call the Eli Wiesel Foundation

"greedy and naive"? Please, what bullshit.

[malaise]

33. Certainly naive

Clearly they trusted one of their own because he was one of their own.
Shared ethnicity, religion or culture is no reason to trust another human being.

I'm betting that those who brought in rich clients made a bag of money.

[alcibiades_mystery]

37. Why not? Because they are a Holocaust foundation they can't be greedy and naive?

That's fucking dumb. Anyone who invested with so little information and quietly expected 10% a year is a greedy fucking pig, and I don't care if they ran the Injured Kitten Foundation.

[C......N......C]

7. SEC

Everybody at the SEC is so anxious for their shot at the big time. They could care less about upsetting the apple cart.

[cbc5g]

9. What you don't get

Is that MANY people went through OTHER people who then went through Madoff. They trusted others with their money, probably people who have done their investments in the past and had no problems before. A lot of these victims were elderly. I don't think they are accomplices.

[DainBramaged]

11. Tell that to the guy who wrote the article, not me...

what, you think I write for the NYT now?

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[david13]

14. Not accomplices. Just greedy and naive. N/t

[TahitiNut]

16. All you're describing is the Amway Scam ... friends don't let friends sell Amway.

:shrug: Amway is nothing but a variant of a Ponzi scheme ... "pyramid marketing."

[Duckhunter935]

10. one word GREED

[stray cat]

12. Is it greed to want to invest where you will increase your retirement or aid a key charity

or in the case of schools build up finances for fiancial aid and scholarships?

[malaise]

32. It is greed to expect more interest than one would

earn from traditional investments. I'd rather buy a lotto ticket.

[suston96]

15. No doubt he had collaboration to swindle this amount of money....

It clearly came from the victims. The money went somewhere. But where did it go?

His quick plea bargain is suspect. Is that supposed to end it? I don't think so.

[wackywaggin]

17. The Madoff clan are still stealing your money!!

Shana Madoff and her husband Eric Swanson are still at it. Swanson was the the head of the SEC compliance division when Bernie madoff was stealing everyones money and Shana Madoff, Bernie's neice worked for Madoff investments. Check out where Eric Swansow is now at: www.batstrading.com and click about, then click management biographies to find out more.

Hang em' High!! :smoke:

[FormerDittoHead]

18. I do think the victim should get his taxes paid back. The government received stolen funds.

Seriously. I don't care about the 3 year rule or whatever, it should go back as far as it went.

He was ripped off, but the governments (local, state and fed) all got his taxes as if the victim was making that money. There is no justice to the government keeping that money.

I do NOT believe, however, they should be given a DIME for their principle losses, however.

These people were NOT greedy. 12% was not 'greedy' in a market which was returning more than that.

Madoff promised them a SAFE investment with returns and I thoroughly believe that if he said returns would be cut, they'd continue to keep their money with him for the SECURITY.

Stop blaming the victim who otherwise didn't have audit resources. The Bush Administration is MUCH MORE to blame for not following up on complaints than any of his victims.

[Waiting For Everyman]

19. Exactly right. These are the same people who wanted the SEC to do nothing.

THEY got what they wanted (from the political influence they bought). They're only pissed that it bit them too, instead of only the people they were taking undue profits from.

They are accompices - in theft against the world.

[DainBramaged]

25. Yup, but so many here who will never earn close to what these people are worth

feel sorry for them, and it amazes me that I am asked to have empathy. Not for the obscenely rich, who spend more on dinner than I spend on food in a month.

[LeftishBrit]

38. What about the charities that have gone bust?

And those who depended on them?

Not all Madoff victims are 'obscenely rich'.

[ladjf]

22. Didn't any of those victims have access to adding machines? nt

[tanngrisnir3]

23. I'm sure they did. Did you have anything relevant to say?

[ladjf]

24. Yes. If they had taken the time to cross check the figures that were

shown on the annual reports the received from Madoff with those that were reported publicly by the companies that were included in their portfolios, they would have seen that Madoff was fabricating the performances. (That is based on the assumption that the clients were at least told the names of the stocks they owned. And if they weren't even told the names of the companies and accepted that, then they were extremely gullible.)

[dkf]

28. Apparently they received statements that looked like normal statements

with the holdings and the transactions.

They had a woman on TV who was a stock broker and she said she couldn't tell it was a fraud because everything looked normal.

[ladjf]

29. If the holdings were listed by company names, the stock performances

as shown on Madoff's reports could have been cross-checked with the published performances of the listed companies. Say the client's portfolio included shares of twenty different companies, each of those companies annual performances would have been public record and would have shown a discrepancy with Madoff's reports.

However, he might not have listed the names of the stocks. In that case the Madoff reports would have been invalid just by the obvious omission of product names.

[dkf]

30. No she said the stock names were listed.

My impression is that they created trades after the fact that looked like they ended up gaining a return.

Say you were creating a fake statement after the end of the trading month. You could find positions that had done well and claim you had done that trade.

Markopoulous found the fraud because he took a look at the options Maddoff said he traded, estimated how many trades he would have had to have done for his clientele, looked at the true number of trades for that day and figured out it was not possible.

But the trades themselves looked perfectly fine.

[ladjf]

31. You have reminded me that there were no real trades.

Thanks for straightening me out on that. Madoff's scam made it more difficult to see that the reports were fraudulent.

[DainBramaged]

35. I hope you enjoyed your trip

[alcibiades_mystery]

36. Too true

I'm a little tired of the innocent self-righteousness of these greedsters. I include the charities in this assessment. Not a lot of sympathy here.