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Wall Street Journal Book Review Unfairly Slams Harry Markopolos

Posted by Larry Doyle on March 9, 2010 12:04 PM |

People in glass houses should not throw stones.

That simple piece of wisdom is both timeless and precious. Regrettably, too many in our media fail to uphold it. Where do I see evidence of it today?

The Wall Street Journal today runs a book review of Harry Markopolos’ recently released No One Would Listen. The reviewer is Richard J. Tofel of ProPublica, a nonprofit investigative-journalism newsroom. Tofel does not denigrate Harry’s work, but he emasculates Harry from a personal standpoint.

Tofel writes:

A crusading legislator who had made a considerable reputation following up on whistleblower charges once told me that nearly all the whistleblowers she had met shared two qualities. First, they were onto something—that is, there was at least some truth to what they were saying. Second, they were “a little bit nuts.” The jacket of “No One Would Listen” identifies Harry Markopolos as “the Madoff Whistleblower.” He would seem to fit the pattern.

The author of “No One Would Listen” is fond of describing himself as “slightly eccentric,” but he is not exactly self-aware. By his account, the fault for his having been ignored throughout eight years of warnings is everyone else’s. But that conclusion requires ignoring much of his story.

The possibility of self-interest probably heightened the skepticism of those he sought to persuade.

Mr. Markopolos tells us that for years, fearing for his own and his family’s safety, he checked for bombs under his car; he also carried a loaded gun and slept with it at his bedside. He did so because he believed—though he offers no evidence—that Mr. Madoff’s clients included Russian mobsters and Latin drug cartels. Even after Mr. Madoff had been jailed, Mr. Markopolos, a longtime Army reservist, feared that the SEC would invade his home, eager to capture and suppress evidence of the agency’s failings: “I loaded a 12-gauge pump shotgun with double-ought buckshot, attached six more rounds to the stock, and draped a bandolier of 20 more rounds on top of my locked gun cabinet. Next I got out an old army gas mask in case they used tear gas.”

None of this behavior makes Mr. Markopolos’s case against Mr. Madoff any less convincing. Nor does it excuse the SEC. But it does provide a fuller picture of the author than the cardboard cut-out of the lonely hero we’ve been hearing about for the past 15 months. With his book, Mr. Markopolos sheds more light than he intends on just why no one would listen.

Why does Tofel slam Harry and paint him as being a nut? Tofel writes in self-defense because he worked for 15 years, including two years as assistant publisher (2002-2004), at The Wall Street Journal, one of the periodicals which failed to pursue the lead on the Madoff story.

I think The Wall Street Journal is an outstanding periodical, but it is hardly perfect. As further evidence of questionable and selective journalism, I would share with my readers that in January 2009 when I unearthed the fact that Wall Street’s self-regulator FINRA owned $647 million in auction-rate securities, I brought those details initially to The Wall Street Journal. After ten days to two weeks of conversation with representatives of the WSJ, for whatever reason they chose not to pursue the story.

I then brought the news to Bloomberg, and to its credit a reporter there pursued the story and broke it late last April including the fact that FINRA liquidated its ARS holdings in mid-2007.

I share that tidbit not to draw attention to Sense on Cents, but rather to highlight that the media needs to be more demanding of itself in upholding its charge to pursue truth, transparency, and integrity everywhere on our economic landscape.

I do not expect The Wall Street Journal, Bloomberg, Sense on Cents or ProPublica to be perfect, but they can be and should be a lot better than this slanderous drivel put forth by Mr. Tofel today.


Related Sense on Cents Commentary

Wall Street Journal Goes in the Tank for FINRA (September 25, 2009)

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