Madoff scandal spooks Wall Street

Madoff scandal spooks Wall Street

There are 21 comments on the LA Daily News story from Dec 15, 2008, titled Madoff scandal spooks Wall Street. In it, LA Daily News reports that:

NYSE, NASDAQ Investors also were nervous ahead of earnings reports later this week from the country's two largest investment banks, Goldman Sachs Group Inc.

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“Cake or Death?”

Since: Dec 08

Palm Beach

#33 Jan 12, 2009

By Scott Malone

BOSTON, Jan 9 (Reuters)- After a decade of trying to convince U.S. authorities that Bernard Madoff's seemingly high-flying hedge fund was a scam, the man whose warnings could have saved a lot of money for a lot of people issued a terse message to the world: Leave me alone.

He will talk to Congressional investigators and that's it.

Madoff stunned the world in December when he allegedly admitted to running a "giant ponzi scheme" that investigators have said cost investors $50 billion. In a ponzi scheme, money from new investors is used to pay back earlier investors.

Many people were fooled, but not Harry Markopolos, the 52-year-old former financial executive who had been onto Madoff since 1996.

Members of Congress have repeatedly invoked Markopolos name in questions to the U.S. Securities and Exchange Commission about how it missed the $50 billion fraud.

"Why in the world didn't anyone respond to his allegations?" asked Rep. Carolyn Maloney, a New York Democrat, referring to a 19-page memo Markopolos wrote to the SEC in 2005 titled, "The World's Largest Hedge Fund is a Fraud." Maloney asked during a Congressional hearing: "What happened to his report?"

Markopolos, who was due to testify before a Congressional panel early this month but begged off because of illness, said in a statement that he would work with Congress and the SEC, but then wanted to get out of the spotlight.

"Once his Congressional testimony is complete and his cooperation with the SEC Inspector General's investigation concluded, he wishes to return to private life," the former chief investment officer of Boston-based Rampart Investment Management Co said in a statement released on Friday by his attorneys.


While Markopolos has drawn praise for spotting the massive fraud, according to media reports he is not so proud of his unsuccessful nine-year campaign with the SEC against Madoff.

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