It’s A Scandal That Early On Fraudsters Bernie Madoff And Robert Allen Stanford Were Not Shut Down By The SEC

Believe it or not, Bernie Madoff’s phony monthly trading reports listed trades on days the market was closed, or at prices that were far off the market, or in volumes that simply never existed. Yet Madoff’s scam continued for 36 years, from 1972 until 2008, as the SEC was incapable of discovering the truth, and Madoff’s clients never read their phoney monthly statements, since through bull and bear markets Madoff always turned in profits that were not real. And shocking as it may seem, the SEC knew that Robert Allen Stanford was a fraud early on in 1998, but chose not to prosecute as the securities he sold were short term notes of a foreign bank supposedly yielding 12% and were not shares of stock registered in the U.S. Imagine the stupidity of that pusillanimous decision. What a bunch of wimps! More on Forbes [...]

CFTC Nominee Bowen Questioned on Stanford Ponzi Scheme Views

U.S. Commodity Futures Trading Commission nominee Sharon Y. Bowen is facing renewed questions about her role in overseeing a panel that ruled against compensation for victims of R. Allen Stanford’s fraud. Senator David Vitter, a Louisiana Republican, sent a letter to Bowen today seeking more information about her decisions as acting chairman of the Securities Investor Protection Corp., an industry-funded nonprofit that protects customers of failed brokerages. Vitter has criticized SIPC’s claim that Stanford victims don’t qualify for compensation. More on Bloomberg BusinessWeek [...]

No Jail Time For Madoff’s Banking and Feeder Fund Pals

The convictions earlier this week of five of Bernard Madoff’s office workers gives the lie to Madoff’s long-held assertion that his massive Ponzi scheme was essentially a one-man show. No one really believed that lie, certainly not the prosecutors and investigators who have scoured over the remains of Madoff’s fraudulent investment firm ever since the disgraced financier was arrested in late 2008. More on Fox Business News [...]

Madoff Fraud Distributions Will Soon Pass $6 Billion

More than five years have passed since Irving Picard was first appointed trustee to oversee the liquidation of Bernard L. Madoff Investment Securities. The New York bankruptcy lawyer and his team have already recovered or entered into agreements to recover nearly $9.795 billion of the approximately $20 billion defrauded from Madoff’s investment customers. This week the trustee’s office announced that a fourth distribution will pay out another $349 million to the Ponzi scheme victims, bringing total payments to more than $6 billion (more than 46 percent of claimants’ losses). “Our commitment is simple: to recover the maximum amount of funds stolen in the Madoff Ponzi scheme and to distribute these funds to their rightful owners as quickly as possible,” Picard said in a statement. More on Bloomberg BusinessWeek [...]

Convicted Madoff aides face forfeiture rulings

The five former Bernard Madoff employees convicted of aiding their boss’ Ponzi scheme face one more verdict along with their expected prison terms — rulings on whether they and relatives must forfeit their largest remaining assets. Prosecutors and defense lawyers earlier this month agreed that U.S. District Court Judge Laura Taylor Swain, not the jury that handed up convictions Monday, should decide the forfeiture issue. The judge, who presided over the more than five-month conspiracy trial, is expected to issue rulings by the time of the sentencings she set for the week of July 28. More on USA Today [...]

Madoff trustee sees victims’ payout nearing $6 billion

Former customers of Bernard Madoff will have recouped nearly $6 billion of their money if a federal bankruptcy judge approves the latest payout request by the trustee liquidating the swindler’s firm. The trustee, New York lawyer Irving Picard, on Tuesday said he is seeking approval to pay out $349 million to fraud victims with 1,080 accounts, with payments ranging from $496 to $77.3 million. More on Reuters here. [...]

Former Madoff associates found guilty of fraud

Five former aides to investment manager Bernard Madoff were convicted on Monday of charges that they helped their boss conceal his multibillion-dollar Ponzi scheme for years. A federal jury in New York found back-office director Daniel Bonventre, portfolio managers Annette Bongiorno and Joann Crupi, and computer programmers Jerome O’Hara and George Perez guilty on all counts, including securities fraud and conspiracy to defraud clients. More on Reuters [...]

NIAP Update - March 24th, 2014


• Garrett/Maloney’s HR3482 – Restoring Main Street Investor Protection & Confidence Act – clears 40 co-sponsors in House but well short of goal of 50% sponsorship on Financial Services Committee

• Stanford victims “celebrate” 5th Anniversary with strong round of Congressional DC meetings in support of HR3482 and S1725

• Trustee moving forward on clawback actions while arguments held on Trustee’s appeal of 2 year clawback limitation in Appeals Court

• Special Master Richard Breeden extends claim filing deadline until April 30th for “Madoff [...]

U.S. judge OKs JPMorgan $218 million Madoff class-action settlement

A federal judge on Friday gave final approval to JPMorgan Chase & Co’s (JPM.N) $218 million settlement to resolve class-action litigation accusing the largest U.S. bank of playing a central role in the huge Ponzi scheme of former client Bernard Madoff. U.S. District Judge Colleen McMahon in Manhattan said the accord “easily meets the standards” for final approval, and provides “substantial and immediate” benefits to the swindler’s former customers. More on Reuters [...]

Madoff Five Trial Judge Cuts Jury to 11 After One Falls Ill

The jury deciding the fate of five of Bernard Madoff’s former employees charged with aiding his $17.5 billion Ponzi scheme will resume deliberations today with 11 members after one fell ill and was dismissed by a judge. The juror’s health isn’t likely to improve soon and replacing her with one of four alternates who attended the five-month trial would have been disruptive because deliberations were under way for two days before the illness, U.S. District Judge Laura Taylor Swain in Manhattan said yesterday. The remaining jurors will be told of the change today, she said. More on Bloomberg [...]