Dear Fellow NIAP Member –
After nearly four years of Madoff investors being frustrated at nearly every turn, I have two important and exciting announcements that should be of great interest in our battle to provide relief and enhance protections for investors who have been abandoned by our investor protection system.
First, I am thrilled to announce an alliance between the Network for Investor Action and Protection (NIAP) and the Stanford Victims Coalition (SVC), an organization of more than 4000 members across 38 states who share in SIPC’s abysmal treatment of innocent investors. The new entity – The Investor Protection Alliance – combines our two regional entities to create one national voice that dramatically expands our capacity to press forward with legislative relief for fraud victims and improved protection for all investors. These frauds can no longer be seen as local problems.
Although both organizations will continue to function independently on their own issues, the Investor Protection Alliance will focus intensively on passage of SIPC legislation. Having worked together with the SVC and its leader, Angela Shaw, behind the scenes for over a year, I can confidently state that the SVC brings not only an enormous amount of energy, legitimacy and grassroots clout, it has won the support of over 100 legislators on their various issues.
I am also very excited to announce that House Capital Markets Subcommittee Chairman Scott Garrett — who introduced HR757 (The Equitable Treatment of Investors Act) and leads the legislative effort — has strongly committed to ratcheting up his efforts and working with us and his fellow House and Senate colleagues to help pass successor legislation to HR757 (as indicated in his letter to NIAP and the SVC). The new legislation will contain language that provides SIPC relief for both Madoff and Stanford investors, prohibits the clawback of innocent investors, and gives the SEC authority over SIPC.
Importantly, Congressman Garrett acknowledges and extends his appreciation for NIAP’s central role in the creation of the legislation and the grassroots efforts of its membership and supporters.
In the coming months Congressman Garrett will introduce marker legislation shortly after the elections, hold additional hearings as necessary as a new bill is introduced in the next Congress, and seek a companion bill in the Senate. In the Congressman’s words, “I am confident that our cause is just and I am determined to see it through.”
The Stanford and Madoff frauds are remarkably similar: both represent frauds by regulated and registered broker dealers, both represent massive failures by regulatory entities, and both are tragedies where SIPC has refused to abide by Congressional intent and denied investors proper protection after numerous dismal institutional failures. Though there may be differences in elements of the two frauds, HR757 and changes being presented will serve to protect the victims of both frauds and investors nationwide. (For more information on the Stanford fraud, go to the new IAP website).
I am very excited about our prospects for success, given our retooled effort. However, our success is dependent on your enthusiastic support and a unified effort, including your ongoing sage input, your dogged involvement in our grassroots campaigns, and your generous contributions to enable us to meet our financial obligations. It is essential that we have the funds and capacity necessary to support operations and keep intact the extraordinary team of professionals who are working with us, helped get us this far, and can help us cross the finish line.
We are confident that our collective membership will rise to the task. Please join with me in welcoming Angela Shaw and the Stanford Victims’ Coalition and their thousands of members as partners in this challenging, critical effort.
Ron Stein, CFP