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The Madoff Trial: Conflicts of Interest

Posted by Larry Doyle on October 7, 2013 10:30 AM |

Close to 5 years after Bernie Madoff turned himself in to authorities for running the largest acknowledged Ponzi scheme on Wall Street, America still knows little as to what truly transpired within those offices in the Lipstick Building on 3rd Avenue in midtown Manhattan.

Do you find it decidedly suspicious that the government has not brought the case against assorted individuals in Madoff’s operation for close to 5 years? I do.

Recall that none other than Harry Markopolos said that it took him little more than 5 minutes to know that Madoff was running a Ponzi scam.

Has the government employed stall tactics in just now bringing this case to trial so as to protect itself and its friends on Wall Street fromg its failures to properly regulate Madoff’s operation and protect investors? How so? 

Information gleaned in this trial may have helped investors in bringing their own claims/suits, but recall that the statute of limitations for prosecuting federal crimes is 5 years. I don’t know about you, but the timing of this case at the 59th minute of the 11th hour strikes me as very suspect.

Truth be told, for those who really care about learning what transpired in Madoff’s operation, the defendants in this case should likely have the company of the regulators from both the SEC and FINRA who failed to perform their duties in protecting investors for so many years.

In fact, not to provide meaningful assistance to the defendants in this case but, if I were their lawyers, who would I call and put on the stand? Former SEC assistant Inspector General David Weber and former SEC attorney Genevievette Walker-Lightfoot. What might Weber be able to share?

After the extent of Bernard Madoff’s Ponzi scheme was fully revealed, virtually every financial news outlet in America agreed that somebody should’ve seen it coming.

In fact, somebody did see it coming, repeatedly warned his employers about how it was coming, attempted to tell everyone else that it was coming, and was eventually fired because he was so annoyingly persistent in attempting to shut down one of the biggest financial crimes of the modern era.

David P. Weber’s term in the US Securities and Exchange Commission was marked by his unwillingness to keep his mouth shut about his superiors’ unethically close ties to Madoff and fellow Ponzi schemer R. Allen Stanford.

For his pains, Weber was put on administrative leave after the SEC banned him from the workplace on ludicrously trumped-up claims that he was psychologically unstable and violent. After formally complaining to the government about the SEC’s suspiciously inept handling of the Madoff/Stanford affairs he was fired for similarly lame reasons, but Weber’s countersuit hit hard, earning him one of the largest whistleblower rewards in US history.

Don’t you think most people in America would like to learn more fully what Weber might have to say about the relationships between those at the SEC and Madoff himself? And in regard to Ms. Walker-Lightfoot:

Ms. Walker-Lightfoot is notably the only former regulator who was uniquely qualified to detect Bernard Madoff’s multi-billion dollar fraud years prior to him turning himself in to the authorities.

In fact, she was in the process of connecting the dots in exposing Madoff when her superiors at the SEC took her off the case. You smell something there?

There is no doubt that regulators who were and largely still are in bed with the industry have killed and continue to hinder a meaningful regeneration of trust and confidence in our markets and economy.

Navigate accordingly.

Larry Doyle

Please pre-order a copy of my book, In Bed with Wall Street: The Conspiracy Crippling Our Global Economy, that will be published by Palgrave Macmillan on January 7, 2014.

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I have no business interest with any entity referenced in this commentary. The opinions expressed are my own. I am a proponent of real transparency within our markets so that investor confidence and investor protection can be achieved.

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