The hedge-fund industry thrives on secrecy. Clients sign non-disclosure forms to keep investment results secret, hedge funds and private-equity firms compare their performance to themselves instead of the broader stock indexes, and nobody knows how much that performance is skewed upward by “survivor bias” because hedge funds have a habit of shutting down after a bad year instead of continuing on to drag the averages down. More in Forbes [...]

“Picard is going to wind up being richer than Madoff.” So said one attorney fighting with Irving Picard, the trustee hired by the SIPC to recover money from the Bernard Madoff Ponzi Scheme and return it to victims. I’ve noted that criticism of the trustee has been mounting in recent years. Picard has ridden his gravy train to instant partner status at Baker & Hostetler and to millions in personal profit (more than $5 million) and hundreds of millions in revenue for his firm ($554 million in legal fees). Read Fierce Finance report here. [...]

Nearly $77 million could be available to Bernard Madoff’s cheated investors if newly filed clawback litigation is successful. Trustee Irving Picard, who is responsible for recovering stolen funds for Mr. Madoff’s investors, on Friday filed two lawsuits seeking the return of $70.1 million from Northern Trust Corp. NTRS -1.78% and $6.7 million from Crédit Agricole Private Banking Miami, according to papers filed with the U.S. Bankruptcy Court in Manhattan. More in the Wall Street Journal [...]

ROBERT SIEGEL, HOST:
You may recall that after Ponzi schemer Bernard Madoff was found out, the Securities Investor Protection Corporation hired lawyer Irving Picard to be the bankruptcy trustee, to recover what he could for Madoff’s victims. And for the past four years, Mr. Picard has been doing that. Not surprisingly, he and others involved in the recovery effort have been charging fees. But what we learn today from New York Times editor and business columnist Andrew Ross Sorkin, is just how much money has been paid out in fees as opposed to how much has been recovered for swindled investors. And let’s just say, Mr. Madoff’s illicit business is evidently pretty big business for Mr. Picard and for the others. Andrew Ross Sorkin, welcome to the program. Click here for NPR interview with [...]

To the dismay of most of the nation’s nearly 630,000 brokers, a growing number of investor advocates are pushing for new ways to force the financial-services industry to be more transparent about fees, practices—and even their scores on the so-called Series 7 exam and other licensing tests. Advocates say the efforts have been gaining ground since the financial downturn and the introduction of sweeping Dodd-Frank measures. More in the Wall Street Journal here. [...]

Irving H. Picard, the court-appointed trustee seeking to recover funds for the victims of Bernard L. Madoff’s multibillion-dollar Ponzi scheme, has been described as a modern-day Robin Hood. For nearly four years, he has been working to pay back those who were swindled by Mr. Madoff, some who lost their entire life savings. Yet a look at recent court filings shows Mr. Picard has had much more success collecting money for himself and a dozen law firms and consultants than any victim of Mr. Madoff’s crime. Read New York Times report here. [...]

Market strategist Barry Ritholtz explains his views on the Facebook IPO debacle and why the social-networking company has no one to blame but itself for the mess due its greed, which he describes as not that far below that of Bernie Madoff. Watch MarketWatch video here.
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The House Financial Services Committee will hold a hearing on either June 6 or 7 on proposed legislation that would establish a self-regulatory organization (SRO) for investment advisors. The legislation is being pushed by Rep. Spencer Bachus, R-Ala., chairman of the committee. According to Investment News, a markup of the bill by the committee is likely by the end of June. He and Rep. Carolyn McCarthy, D-N.Y., are sponsoring the bill. The bill is likely to be reported out by the Financial Services Committee, but unlikely to win support in the Senate even though it may be approved by the full House as well. In announcing that he was introducing the bill, Bachus said that the average SEC-registered investment advisor can expect to be examined less than once every 11 years. Read LifeHealthPro report here.
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