By John W. Lillpop

A cliché commonly used when discussing justice in America is,”You do the crime, you must do the time.”

Fair enough. However, why is that standard of justice nearly non-existent when it comes to a despicable swindler like Bernie Madoff?

Madoff is the American businessman and former chairman of the NASDAQ stock exchange who was arrested on December 11, 2008 and charged with engineering the largest investor fraud ever committed by a single individual in world financial history.

Madoff created an elaborate “Ponzi Scheme” in which he swindled well-schooled bankers, Wall Street investors, charities, and individuals out of $50 billion dollars.

That number $50 billion is hard for most people to comprehend. Think of it in familiar terms: George W. Bush sent $17 billion of your money to bail out automakers in December.

Bernie Madoff swindled three times that amount from professionals and others that should have known better.

Despite the enormity of his crimes and the harm inflicted on countless numbers of innocent people, Madoff is a free man, after posting a $10 million bond.

While the U.S. Congress and prosecutors sort out the greatest hoax in history, the mastermind of deceit continues to enjoy a life of luxury and opulence made possible by that very hoax.

Madoff’s successful run of felonies has put enormous pressure on the Securities and Exchange Commission (SEC), the government agency created in 1934 to regulate the stock market and prevent corporate abuses relating to the offering and corporate reporting.

For a complete history of the SEC, refer to reference (1).

The burning question running through the halls of Congress and minds of jilted investors is: Why did the SEC fail to catch this bottom-feeding crook? How in the hell did one man manage to steal $50 billion from some of the most sophisticated and tough-minded money people in the world in the heavy regulated environment of financial investments?

Has Bernie Madoff ever been investigated by the SEC?

In fact, the SEC did investigate Madoff at least eight times since 1992 as reported by the Associated Press, Reference 2.

From the linked reference this summary in part:

“The many fruitless probes into Bernie Madoff:

Starting in 1992, federal regulators on many occasions examined various aspects of Bernard Madoff’s business operations, but they never turned up the alleged $50 billion Ponzi scheme that led to Madoff’s arrest last month. The history of regulatory failure in the Madoff scandal:

1992

Securities and Exchange Commission

Madoff’s name comes up in a probe of Florida accountants who allegedly sold unregistered securities.

1999

SEC examiners review trading practices at Madoff’s investment advisory firm.

2001

The SEC’s Boston office receives information from securities industry executive Harry Markopolos raising questions about the steady stock market returns of Madoff’s firm.

2004

The SEC looks into whether Madoff’s firm engaged in improper trading practices.

2005

The SEC interviews Madoff and members of his family, finding no improper trading practices.

2005

An industry-based regulatory office finds no improper trading practices by Madoff’s firm.

2005

SEC investigators meet with Markopolos, who alleges that Madoff’s firm is “the world’s largest Ponzi scheme.”

2006

An SEC enforcement investigation finds that Madoff and one of his clients misled regulators. As a result, Madoff agrees to register as an investment adviser.

2007

The Financial Industry Regulatory Authority examines Madoff’s firm. No regulatory action results.”

Eight alleged investigations and a $50 billion Ponzi scheme goes undetected? Who in the hell were the SEC “investigators”? Big Bird and the Cookie Monster from Sesame Street?

Amazingly enough, Harry Markopolos, while working at a rival firm, wrote in 1999 that Madoff was running a Ponzi scheme. Markopolos now looks like a certifiable genius, a fact that is of little comfort to those whom Madoff robbed, or SEC commissioners and employees who are left looking like complete fools, or worse.

The bottom line seems to be that, as of now, no single explanation makes sense in the bizarre Bernie Madoff crime spree.

Allan Sloan, senior editor at CNN Money Fortune (Reference 3) filed this report, in part:

“CNN Money Fortune

“NEW YORK (Fortune) — Yes, there really are times when life imitates art. A case in point: the Bernie Madoff scandal, in which the disgraced investor bears a startling resemblance to Zero Mostel’s sleazy theater promoter in one of my favorite flicks, “The Producers.”

“What do the real-life Madoff and Mostel’s fictional Max Bialystock have in common? They used the same principles to pull off a big-time financial fraud. These are: If you’re going to steal, steal big. If you’re going to cook the books, make up numbers of your own - don’t try to doctor the real ones. And, finally, if you’re going to fleece people, turn down enough potential investors so that those whose money you take feel so honored that they don’t do basic homework to find out about you.

“No, I’m not making light of what Madoff did, which has ruined the lives of people who went to sleep feeling rich and woke up poor, and which has devastated worthy charities. I’m just trying to show you how the world works, and why we see the same things, year after year, decade after decade, with frauds like Madoff and the Bayou hedge funds and other less famous sleazoids.

“How could the Securities and Exchange Commission, which admits it had gotten tips about Madoff for years, bring some penny-ante insider-trading claim against Dallas Mavericks owner Mark Cuban while failing to see that Madoff was ripping off billions from the likes of Elie Wiesel’s foundation?

“Not to prejudge the SEC’s investigation of itself, but I’ll bet the answer will turn out to be that things have always been this way and probably always will be. If commission enforcers get a bigger budget and are treated with respect rather than being dissed (including, I’ll bet, by some of Madoff’s victims) as an obstacle to free markets, things may improve. But don’t expect a fraud-free era to ensue.

“I’m saying this not out of cynicism but because I know how regulators generally work. I’ve seen it for years, in fields ranging from department stores to oil-drilling partnerships. You’re likely to get caught if you run a few inches outside the baseline, because regulators are set up to catch that. But run so far out that you’re playing on a whole different ball field? You can get away with that if you’re enough of a financiopath, and your luck holds.

“Take the mutual fund “market timing” scandal kicked over by Eliot Spitzer back when he was New York’s respected attorney general rather than its disgraced “love guv.” As you may recall, many foreign-stock mutual funds - which, like all mutual funds, are regulated up the wazoo by the SEC - were allowing hedge funds to do quick trades that ripped off the funds’ long-term investors by diverting profits from them to the hedgies. (This really should have been called “skimming,” but that’s another story.)

“Spitzer’s folks got tipped to this game by an informant - but it turned out there had been plenty of hints, such as hedge funds telling clients about their “timing” activities. The reason the SEC didn’t find this during its routine audits was that it wasn’t looking for it. Who’d have thought that funds would be so stupid as to risk their most valuable asset - their reputation - for the relative crumbs the hedge funds threw them?

“No one picked up on our fictional friend Max Bialystock because he made up a fraud from whole cloth - he sold investors 25,000% of a ghastly, tasteless musical, “Springtime for Hitler,” that was designed to fail and let him keep the money, but became a huge hit. Like Madoff, Bialystock didn’t have enough money to pay off investors who wanted their dough.

“Both scamsters also generated an aura of exclusivity by not taking money from just anyone. “It’s due diligence by crowd, and it doesn’t work,” says Jim Mintz, whose Mintz Group specializes in background checks.

“There’s a big move on for the SEC to regulate hedge funds. It’s a worthy idea. But trust me. If a big fund is engaged in a big fraud, the SEC’s unlikely to find it without an outside tip. Or maybe even with one. That’s how things worked with Madoff. And how they work in the real world. And how they’ll probably always work. ”

Which brings up an interesting point about deposed New York Governor Eliot Spitzer: Was the powerful Democrat spending too much time and money on ladies of the night at the Emperor’s Club to catch Bernie Madoff?

A video on Finance Yahoo (Reference 4), provides even more information on the Bernie Madoff story and is worth viewing.

References:

(1) History of SEC http://en.wikipedia.org/wiki/U.S._Securities_and_Exchange_Commission

(2)

http://www.google.com/hostednews/ap/article/ALeqM5iIXcRJuIjbkGKM5GT0txn4-1CJowD95H7FI80

(3)
http://money.cnn.com/2009/01/05/magazines/fortune/sloan_madoff.fortune/?postversion=2009010506

(4)
http://finance.yahoo.com/tech-ticker/article/152910/SEC-Investigated-(And-Fooled-by)-Madoff-Eight-Times?tickers=^dji,^gspc,dia,spy,qqqq

By John W. Lillpop

January 1, 2009 is indeed a memorable day in the history of Iraq and for the people of that nation.

So memorable and important, in fact, that Iraqi Prime Minister Nuri al-Maliki has proposed that each January 1 be officially celebrated as “Sovereignty Day,” in addition to the traditional New Year’s holiday.

In case you missed it, responsibility for a major portion of Iraq’s security has been officially handed over to the Iraqi government. That includes Baghdad’s “Green Zone” as described in the referenced excerpt(1).

Quite predictably, sovereignty day in Iraq did not rise to the level of BREAKING NEWS! in the minds of left wing American media, those “objective” souls obsessed with chronicling every movement, or hint of movement, by a Marxist President-elect dawdling in the warm sands of Honolulu’s beaches!

However, the turnover did mean a great deal to Iraqi Prime Minister Nuri al-Maliki who said:

“It is our right to consider this day the day of sovereignty and the beginning of the process of retrieving every inch of our nation’s soil,” Nuri al-Maliki said in a ceremony.

For those who care, Iraq has regained control of it’s own airspace and is scheduled to hold provisional and national elections in January and December, respectively.

As reported in the excerpt from reference (2):

“Iraqis have a double opportunity to make their new found voices heard at the ballot box this year.

“Provincial Elections are due to take place on 31 January. And, according to the Iraqi Constitution, national elections will need to be held by December 2009 as well.

“After years of living under tyranny, unable to influence or hold to account the former regime, Iraqis are keen to once more practice their new democratic rights.

“Local and national elections were last held in 2005.

“The path of democracy and political maturity since 2003 hasn’t always been smooth. But it is taking shape.”

So, why has the good news from Iraq escaped BREAKING NEWS status in American media?

For starters, Iraq is breaking news ONLY when young American men and women are being wasted in record numers, or when the American military is alleged to have reenacted the Holocaust by nuking innocent Iraqi citizens in place of starving Jews.

American deaths in Iraq have all but vanished, leaving the New York Times and other bastions of liberal propaganda completely depressed and disinterested!

Then there is this distressingly inconvenient truth: The “surge” crafted by General David Patreaus and commander-in-chief George W. Bush actually WORKED!

By the by, that would be the same surge that our Messiah in Waiting voted against!

Finally, ANY good news linked to the name George W. Bush is automatically relegated to page 1,120, or buried somewhere in the obituaries, presented in size two font, if you please, headline in lower case.

Still, congratulations are in order to the people of Iraq who can now look forward to the future without worrying about being tortured, maimed, or slaughtered by the “butcher of Baghdad,” the late, not-so-great Saddam Hussein.

Only liberal nut balls like attorney Ramsey Clark, the man whose failed legal defense of Saddam Hussein should make him eligible for a Nobel Peace prize, believe that the world is not better off, and safer, with the despicable dictator permanently confined to a six-foot deep hole in Takrit.

Finally, although “Sovereignty Day” does have a nice ring to it, a more jubilant spirit might be fostered with a more colorful designation.

How about, “Purple People” Day?

HAPPY PURPLE PEOPLE DAY!

References:

(1)

http://blog.wired.com/defense/2009/01/sovereignty-day.html

(2)

http://www.fco.gov.uk/en/fco-in-action/uk-in-iraq/iraq-case-studies/iraq-elections09/

2008 has been a year of spectacular ups and down for Plaxico Burress, a professional football star. His journey from riches to rags is amazingly similar to that experienced by professionals who play with other people’s money in the game of life on Wall Street.

The personal high for Plaxico Burress came at Super Bowl XLII on February 3, 2008. That game between the New York Giants and New England Patriots was the most-watched Super Bowl of all time, with an average of 148.3 million total viewers throughout the world watching some part of the game

It was also the second most-watched TV program of all time in the United States.

Plaxico Burress made headlines when he caught the winning touchdown pass in the end zone with just 35 seconds remaining to give the New York Giants a thrilling upset victory, 17-14.

The New York Giants were the improbable champions of Super Bowl XLII and Burress was a hero.

On the last business day before the Super Bowl and Burress’ magnificent catch, the Dow Jones Industrial average closed at 13, 265.

The next big event for Plaxico Burress came on April 30, 2008 when he and the World Champion New York Giants were hosted at the White House by President George W. Bush in honor of their stupendous victory in Super Bowl XLII.

Plaxico Burress’s unbelievable high of February 3 began to unravel in May when the star decided that he was being underpaid with his $3.25 salary for 2008.

Difficulties continued to hound Burress in September and October when he was suspended for violation of team rules and fined $45,000 by the National Football League.

It all came crashing down with great finality on November 28 when Burress shot himself in the right thigh while relaxing in a New York City nightclub. His injury was not life threatening and he was released from the hospital on November 29.

On Monday, December 1, Burress turned himself in to New York police to face charges of criminal possession of a handgun.

His cause was not helped by New York Mayor Michael Bloomberg who demanded that Burress be prosecuted to the fullest extent of the law. Burress had an expired license for the firearm from Florida, but no New York license. Unlawful carrying of a handgun carries a minimum three and a half-year jail sentence.

Mayor Bloomberg must have simply forgotten the catch that Burress made in February to bring the Super Bowl championship to New York City.

On December 2, Burress posted bail of $100,000.

Later in the day, he was suspended by the New York Giants for conduct detrimental to the team, which means that Burress will not be paid for the remainder of the season.

In just ten short months, Burress managed to go from Super Bowl hero to the ranks of the unemployed while facing a felony charge for damn near blowing his own leg off with a hand gun.

For Plaxico Burress, the worse may be yet to come: His foolish gunplay could cost him 3.5 years in prison.

Meanwhile, the Down Jones Industrial Average on Wall Street has plunged from 13,265 on February 1, the Friday before Super Bowl XLII, to 8,419 at the close of business on December 2.

Pity that while Plaxico Burress faces a possible prison sentence for foolish behavior resulting in great harm to himself, the characters on Wall Street, whose foolishness has harmed millions of innocent Americans, continue to be beneficiaries of a government gone barking mad with bail out fever.