Posts filed under “Legal”

Why Might a Madoff Plea Deal Take Place?

Fascinating conversation today over lunch today.  It was held under Chatham House Rules, so I cannot reveal the identity of any of the parties or their firms.

However, the conversation steered towards the Madoff affair, and one fellow proffered the thinking behind why Madoff remains out on bail, and could be working towards a plea deal.

A guilty verdict is a slam dunk in a trial. However, that does nothing for the $43 billion in lost assets for the folks who were taken (i.e, investors/confidence marks).  and, it seems that Madoff’s remaining assets, versus what was stolen/lost/embezzled are a mere pittance.

Hence, the possible Madoff deal. One theory floating around is that Madoff will implicate the major banks (HSBC, RBS, Santander, BNP Paribas, Nomura), fund of funds, referrers in his massive fraud. Once he rolls over and sings, alleging they knew (or should have known) it clears the path for a massive litigation frenzy against any and all of the parties involved.

I feel sad fort he people who lost money, but if this theory is remotely accurate, it would be terrible. It would allow a (alleged) horrific con man/thief avoid justice. And, it rewards the people for their own bad judgment in giving Mr. Mathematically-Impossible/No-Fees their money, while seeking to place the blame elsewhere.

Zero responsibility for all involved! Its the American way!


Credit Suisse Urged Clients to Dump Madoff Funds
Cynthia Cotts, Katherine Burton and Elena Logutenkova
Bloomberg, Jan. 7 2009

Signs Seen of Possible Plea Deal for Madoff
NYT, January 13, 2009, 7:32 am

Bank Safdie Dodges Madoff Loss, Predicts More Hedge Fund Rules
Warren Giles
Bloomberg, Jan. 8 ( 2009

Category: Legal, Markets, Trading

Madoff’s Investors Had $43 Billion

via Bloomberg:

Client                   Total          Source

Access International     $1.4 billion   Company statement,
Advisors                                Bloomberg Data

Alicia Koplowitz,        $14 million    Bloomberg News
One of Spain’s richest

Aozora Bank Ltd.         12.4 billion   Company statement
                         yen ($137

Bard College             $3 million     Bloomberg News
 Read More

Category: Digital Media, Finance, Legal

Ponzi Schemes

Bernard Madoff lost less money than AIG and he throws way better parties.


Category: Humor, Legal, Markets, Video

The Madoff Whistleblower

Fascinating piece you may have overlooked this week in the Boston Globe on Harry Markopolos, the author of the detailed November 2005 memo to the SEC, identifying 29 red flags about Madoff and concluding he was a fraud. Excerpt: “A month ago, Harry Markopolos was an accountant unknown outside Boston’s financial community. Now the slight,…Read More

Category: Investing, Legal, Regulation

Posting Bail in Korea is a Bitch

> Thank you for all the kind words and well wishes after my ordeal in Korea: South Korea said on Thursday it had arrested an elusive blogger accused of undermining the country’s financial markets with his doom-mongering, ending a case that has illustrated government unease with the growing influence of online ­gossip in the world’s…Read More

Category: Legal, Weblogs

How Long til Madoff Losses Are Recovered ?

Earlier today, we looked at the NYT interactive graphic that calculates how long it will take to return to breakeven for typical portfolio losses. But what if you were one of 8000 Madoff investors, and your portfolio is now worth zero? For starters, you should get $500k from SIPIC. Then, there is the $830 million…Read More

Category: Investing, Legal, Markets, Regulation

Former NAR Economist David Lereah is a Jackass

Alternative Title: David Lereah: Even More Full of Shit Than Previously Believed > Of all the various parties who contributed to the boom and bust in housing and credit, none have escaped more unscathed than the National Association of Realtors, and their former Baghdad-Bob-in-Chief, David Lereah. The NAR turned a blind eye to fraud amongst…Read More

Category: Contrary Indicators, Legal, Real Estate, Really, really bad calls

Inside Look: Madoff Mayhem

Analysis and Discussion with University of Rochester President Joel Seligman, Also an SEC Historian

January 03, 2009

Featuring Interview with Former SEC Official Jacob Frenkel

January 02, 2009

Category: Legal, Regulation, Video

How to Repair a Broken Financial World

Here is another excerpt — part II — of the all consuming OpEd of the Sunday New York Times by Michael Lewis and David Einhorn: Excerpt: When Bear Stearns failed, the government induced JPMorgan Chase to buy it by offering a knockdown price and guaranteeing Bear Stearns’s shakiest assets. Bear Stearns bondholders were made whole…Read More

Category: Bailouts, Credit, Derivatives, Legal, Markets, Really, really bad calls, Regulation

The End of the Financial World As We Know It (and I feel fine)

The entire OpEd section of the Sunday New York Times has been taken over by an article jointly written by Michael Lewis and David Einhorn, titled The End of the Financial World As We Know It. Its this morning’s must read piece . . . Excerpt: “OUR financial catastrophe, like Bernard Madoff’s pyramid scheme, required…Read More

Category: Bailouts, Credit, Derivatives, Legal, Really, really bad calls, Regulation