Madoff ponzi scheme gets Congressional Hearing

“We preside at a critical moment in our history, and our
work on these matters in the 111th Congress will influence
the securities industry for generations to come.” said
Chairman Paul Kanjorski (D-PA)

Today a hearing was held on assessing the Madoff ponzi
scheme and regulatory failures. The subcommittee on
capital markets, insurance and government sponsored
enterprises reviewed the 50 billion dollar securities
fraud for the second time. Their objective was to discuss
reshaping and reforming the Nation’s financial services
regulatory system. The hearing revealed that other cases
have surfaced since the Madoff case especially this past
month. Mr. Harry Markopolos, an independent financial
fraud investigator for institutional investors, forensic
accounting expert, chartered Financial Analyst and
certified Fraud Examiner was the witness present who
testified at this hearing. Mr. Markopolos was
complimented by members of the House on his works for
taking extra steps to hear Madoff investor’s concerns.
Markopolos felt the SEC (Securities and Exchange
Commission) was incapable of understanding the full
potential of the situation, failed to properly investigate
and the fraud should have been stopped. Markopolos’s team
was tracking Madoff for years and identified 14 feeder
funds only two of which have become public and are still
some present in Europe. Markopolos informed the House
that Madoff had swept everything out of investor’s
accounts and put them in treasuries. The SEC didn’t
investigate these securities because Madoff didn’t report
them to the SEC so there was nothing for auditors to
inspect. Markopolo’s indicated it only took him 5 minutes
to find out Madoff was a cheat, however; nothing was made
public until after Madoff’s confession. Markopolo’s
revealed he was not hired and there was no compensation
for his duties but rather did it on the sole purpose of
the American Capital System.

“I look forward to explaining to Congress today and the
SEC’s Inspector General tomorrow, what I saw, when I saw
it and what my dealings with the SEC were that led me to
this case being repeatedly ignored over an eight in a half
year period between May 2000 and December of 2008.” said,
Markopolos

By Candyce Torres, University of New Mexico-Talk Radio News Service.