Incompetent SEC examiners kept scheme alive – says Madoff
Daylife/Reuters Pictures used by permission
Nobody was more surprised that the Securities and Exchange Commission did not discover Bernard L. Madoff’s enormous Ponzi scheme years ago than Mr. Madoff himself.
After all, it would have been pretty simple, he said in a transcript of a jailhouse interview that is part of a trove of official exhibits released on Friday by the S.E.C.’s inspector general, H. David Kotz.
In the interview, Mr. Madoff said that the young investigators who pestered him over incidentals like e-mail messages should have just checked basics like his account with Wall Street’s central clearinghouse and his dealings with the firms that were supposedly handling his trades.
Those simple steps, he added, could have revealed years earlier that he was running the largest Ponzi scheme ever, a crime that has now dragged the S.E.C. into the worst scandal in its 75-year history. “It would have been easy for them to see,” he added.
The new exhibits consist of 6,157 pages of interviews, letters, e-mail messages, telephone records and other background material gathered during Mr. Kotz’s 10-month investigation of how the commission handled, and mishandled, numerous tips and warnings it received about Mr. Madoff over the years. His full report, released last month, found the agency had received six substantive complaints since 1992 — and botched the investigation of every one of them. He found no evidence of any bribery, collusion or deliberate sabotage of those investigations.
You needn’t worry much about investigators when you know the highest agency of the electorate – the United States Congress – has abdicated any responsibility for oversight. It started in 1994 with Newt’s Contract on America – accelerated and grew through K Street and C street – culminating in the Halliburton Years with Dickie and George W..