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January 7, 2014

Another Madoff Swindle

Long after most people have stopped paying attention to Bernie Madoff’s $17 billion investment fraud, look who’s lining up with the victims to snag a piece of the financial recovery. Why, it’s none other than the U.S. government, the same outfit that helped Madoff get away with cheating his clients by ignoring warnings about him for years.

Federal law enforcers are returning to their favorite piggy bank, J.P. Morganto extract an expected settlement of more than $2 billion. Madoff was a customer of the bank, and the feds allege that Morgan failed to issue warnings about their con-man client. But only some of the settlement money is earmarked for victims; the rest will go straight to Washington.

For the federal government to receive even a nickel of this recovery would represent as slick a swindle as anything Madoff ever did. Starting at least as early as 1992, the Securities and Exchange Commission began ignoring the red flags around Bernie Madoff. That year two accountants were charged with marketing Madoff investments with bogus promises of sky-high returns, but apparently it never occurred to regulators that the problem might lie with Madoff.”

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Read full Wall Street Journal article here

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