Harry Markopolos, who told the SEC about Madoff in 2005, will testify before Congress today. (prepared statement PDF)
It is absolutely devastating. Among other things, Markopolos says that because of the SEC’s “abject failure” to do anything, because of its “investigative ineptitude and financial illiteracy,” he was in fear for the safety of his family.
No. It was not incompetence. It was quite deliberate. SEC was headed by free marketeer zealots who quite methodically set out to insure that nothing would “interfere” with the markets.
Of course there was certainly ample opportunity for corruption too. Not to mention Markopolos being, probably quite justifiably, scared for his life. “If Mr. Madoff was facing life in prison, there was little to no downside for him to remove any such threat,” he said.
So Markopolos apparently thinks Madoff is quite capable of having someone killed. Tell me, just who is this Madoff fellow and most especially, who are those, still hiding in the shadows, that helped him pull this off?
This is an infuriating document. Infuriating to me personally, because I can tell you that if Markopolous had come to me or to anyone at Business Week — which at that time (May 2000) had editors who could actually understand such things — he’d have been taken seriously and his allegations would have been investigated thoroughly.
Markopolos laid out the case against Madoff. He spoon fed it to the SEC, and they spat it out. Something needs to be done to prevent this from happening again, or else, really, what is the point of having an SEC?
Why did they spit it out? Who specifically at SEC killed the investigation? And who are their friends? Let’s follow the money trail in all of their bank accounts.
PS Self-evident thinks Markopolos may be a bit of a crank, not that it excuses anything, they say, but still…