Madoff Whistleblower Markopolos On The Hill (VIDEO)


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Not surprisingly, Markopolos’ delivery is as fiery and convincing as his written statements suggest it would be. The SEC is getting crushed.

We’ll update as necessary during the Q&A with pertinent revelations.

Q&A: Our favourite quote so far: “The SEC was never capable of catching Madoff” Had it not been for the financial crisis, Markopolos says, Madoff would’ve run the Ponzi to $100 billion.

— Another suggestion: A centralized database of all financial enforcement actions. So if regulators in a state, or at another agency slap someone, the folks at the SEC can instantly know about it when they run a search. Sounds like some of the suggestions floated after 9/11, for more sharing between agencies.

–In general, despite Markopolos’ criticism of the SEC, he’s still a believer in it — or a believer in the idea that a regulator like the SEC could actually stop fraud (we’ve been sceptical of this). If you have the right leadership and a staff that’s really up to speeed, then he thinks the agency could work is advertised.

— Exciting. Markopolos says he plans to announce another Ponzi bust tomorrow! Details.

— Alas, no hope that Markopolos himself will be heading to the SEC, at least not for the next two years.

— Interesting question from Congressmen: Why didn’t all the Wall Street guys who kind of thought Madoff might be a fraud do something? Markopolos says there’s a code of silence on Wall Street. You don’t throw stones. “We can not afford to not find white collar criminals and punish them severely.” Markopolos says there are still people out there that Wall Street suspects are fraudsters. “They need to start coming forward.”

— Great line: “The SEC exists to protect predatory organisations from investors”

— On his safety fears: “I don’t consider it paranoia… When you’re that big, you start attracting a lot of dirty money” Mobsters, Russian oligarchs.

— If the feeders didn’t know, “they were wilfully blind, and they got paid a lot of money to be wilfully blind.”

— Suggestion from Markopolos: Give SEC employees Bloomberg terminals. That makes sense.