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From Prison, Madoff Says Banks ‘Had to Know’ of Fraud
New York Times ^ | 02/16/2011 | DIANA B. HENRIQUES

Posted on 02/16/2011 6:24:51 AM PST by safetysign

Bernard L. Madoff said he never thought the collapse of his Ponzi scheme would cause the sort of destruction that has befallen his family.

In his first interview for publication since his arrest in December 2008, Mr. Madoff — looking noticeably thinner and rumpled in khaki prison garb — maintained that family members knew nothing about his crimes.

But during a private two-hour interview in a visitor room here on Tuesday, and in earlier e-mail exchanges, he asserted that unidentified banks and hedge funds were somehow “complicit” in his elaborate fraud, an about-face from earlier claims that he was the only person involved.

(Excerpt) Read more at nytimes.com ...


TOPICS: Business/Economy; Crime/Corruption; News/Current Events
KEYWORDS: banking; bankone; banks; bernardmadoff; berniemadoff; chasemanhattan; chemicalbank; classaction; deeppockets; dimon; funds; hadtoknow; hanover; jamiedimon; jpmorgan; jpmorganchase; lawsuit; madoff; morganchase; ponzi; tort

1 posted on 02/16/2011 6:24:55 AM PST by safetysign
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To: safetysign
Madoff: More honorable than most politicians.

And giving a far better bang for the buck, apparently.

2 posted on 02/16/2011 6:29:02 AM PST by the invisib1e hand (talk to the hand)
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To: safetysign

What constitutes ‘knowing’?

If you mean having sufficient evidence to convict Mr. Madoff in a court of law, nobody had that until he confessed.


3 posted on 02/16/2011 6:31:40 AM PST by proxy_user
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To: proxy_user

He will have a heart attack soon.


4 posted on 02/16/2011 6:37:35 AM PST by scooby321
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To: safetysign

I still do not get why Madoff is in prison. There are rapists, armed robbers, murderers and other real criminals who will do less time than he did.


5 posted on 02/16/2011 6:39:27 AM PST by pnh102 (Regarding liberalism, always attribute to malice what you think can be explained by stupidity. - Me)
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To: safetysign

Then again, he could be lying about this in order to get some love from the MSM, because we know they love ANYBODY who will bash the “evil” bankers.


6 posted on 02/16/2011 6:42:30 AM PST by Ronald_Magnus
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To: proxy_user

The law is pretty clear on “structuring” and transfers to offshore accounts. A banker doesn’t have to know *why* you’re structuring your transactions a certain way, all they have to do is report the activity. The activity could be completely legit, but the federal law still requires a report be made.

It would appear that the banks pretty much looked the other way... because one side of the bank was earning fat fees from Bernie, so the other parts did his bidding.

The bankers have now opened themselves to civil lawsuits (ordinarily I’d also add “and criminal charges,” but we all know that the bankers will walk away scot-free), and therefore they have failed in their fiduciary duty to their depositors and investors.


7 posted on 02/16/2011 6:43:56 AM PST by NVDave
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To: NVDave

The laws you mention require banks to file CONFIDENTIAL reports. Therefore, for all we know some banks may have actually filed them, and the government ignored them.


8 posted on 02/16/2011 6:49:02 AM PST by proxy_user
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To: CutePuppy; ken5050; Condor51; Grampa Dave; sickoflibs; Libloather; DeaconBenjamin; markomalley; ...
Madoff's e-mail asserted that "unidentified banks" were somehow “complicit” in his elaborate fraud.................

Remember when Goldman Sachs had a Friend in the WH named Rahm Emanuel? J.P. Morgan now has a friend in the WH by the name of Chicago Bill Daley.

Ohaha's new COS is Bill "Let's Count the Ballots Again in this Locked Room" Daley. Daley headed the Chicago Branch of The Daley Family Vote Mfg Division which was hired for the infamous Florida recount. The Daley family motto is "When We Fix Elections, They Stay Fixed."

NOTE During the 2008 Democratic presidential primaries, Daley was a prominent supporter of Barack Obama. On November 5, 2008, Daley was named to the advisory board of the Obama-Biden Transition Project.

====================================

MORE DALEY TIDBITS: Bill Daley (brother of Chi/Mayor Richard Daley), is former Commerce Secy under Clinton and long-time executive at Wall Street’s JP Morgan Chase.

REFERENCE Lehman's Bankruptcy Estate Sues J.P. Morgan
WSJ | 5/26/2010 | BY MIKE SPECTOR And SUSANNE CRAIG
FR Posted May 26, 2010 by markomalley

Lehman's Bankruptcy Estate Sues JP Morgan Chase & Co., alleging that JP Morgan illegally siphoned billions of dollars from Lehman in the days before the investment bank filed the largest bankruptcy in US history.

The lawsuit, filed Wednesday in US Bankruptcy Court, New York, alleges that JP Morgan Chief Executive James Dimon and other top executives used inside knowledge to take advantage of Lehman as its financial state worsened.

JP Morgan coerced Lehman to turn over $8.6 billion in collateral in Sept 2008, triggering a liquidity squeeze that contributed to Lehman's collapse, the suit said. The estate is hoping to recoup billions in collateral the bank demanded, and other damages. (Excerpt) Read more at online.wsj.com ...

=============================================

Daley became associated with Amalgamated Bank of Chicago, where he was first vice chairman (1989–1990) and then president and chief operating officer (1990-1993). Daley returned to the practice of law, as a partner with the firm Mayer Brown (then Mayer, Brown & Platt) from 1993 to 1997, where he served on the board of Fannie Mae.

In December 2001, he was appointed President of SBC Communications Inc. to help reform the company's image.

In May 2004, Daley was made Midwest Chairman of J.P. Morgan Chase and Bank One Corp. to oversee post-merger operations from Chicago. (See JB Morgan billion dollar looting reference above--circa 2008.)

Daley currently serves on the Boards of Directors of Boeing, Merck & Co., Boston Properties, Inc., and Loyola University Chicago. He is also a trustee of Northwestern University and sits on the Council on Foreign Relations.

In 1993, he served as special counsel to the President on issues relating to the passage of the North American Free Trade Agreement (NAFTA). In 1997, Daley became Secretary of Commerce in the second administration of President Bill Clinton, and he remained at that post until July 2000, when he resigned to campaign for the Vice President.

After he resigned as Commerce Secretary he became chairman of Vice President Al Gore's presidential campaign. He was portrayed in the HBO film Recount, about the Florida election recount of the 2000 presidential election, by actor Mitch Pileggi.

====================================

REFERENCE Madoff Trustee Says A High-Level JPM Exec Was Warned About Madoff Well In Advance
Feb 3, 2011 | The Business Insider | Katya Wachtel
FR Posted by FromLori

A high-level JPMorgan risk officer was warned that Bernie Madoff had “a well-known cloud” over his head and was suspected of running a Ponzi scheme nearly 18 months before he was charged, according to the FT. The lawsuit in which it's alleged that the executive was forewarned was filed against JPMorgan by Irving Picard, the trustee responsible trying to recover as many funds as possible for Madoff. It has just been unsealed, and was filed secretly at JPMorgan’s request. The suit aims at recovering $1 billion in fees and profits that JPMorgan earned as the primary banker to Madoff’s firm and by structuring Madoff-related derivatives. Picard also wants more than $5 billion in damages. (Excerpt) Read more at businessinsider.com ...

9 posted on 02/16/2011 6:57:39 AM PST by Liz
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To: stephenjohnbanker

ping


10 posted on 02/16/2011 7:08:28 AM PST by Liz
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To: safetysign

Like the bank robber who says it’s the banks fault he robbed it because it had money.


11 posted on 02/16/2011 7:41:17 AM PST by ReverendJames (Only A Painter Or A Liberal Can Change Black To White)
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To: ReverendJames
Like the bank robber who says it’s the banks fault he robbed it because it had money.

Yeah, it's exactly like that, except in cases like Madoff, the banks take a big share of the stolen money. That's why there is always the suspicion that they weren't just innocent bystanders.

12 posted on 02/16/2011 7:45:00 AM PST by Walts Ice Pick ("I'm not going to shut up!" - Sarah Palin)
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To: pnh102

Because only Fedzilla gets to run a Ponzi scheme.


13 posted on 02/16/2011 7:53:13 AM PST by liberalh8ter
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To: pnh102

I don’t understand your confusion. Could you explain?


14 posted on 02/16/2011 7:53:43 AM PST by DManA
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To: Walts Ice Pick

How many banks were involved? There were a lot of people banking money too. So how did the banks know that the money came from a ponzi scheme? Did Madoff tell them it was fraudulent money?


15 posted on 02/16/2011 7:55:55 AM PST by ReverendJames (Only A Painter Or A Liberal Can Change Black To White)
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To: Liz

The banks “had” to know, but he also said that the Wilpons had NO idea...yeah..right..


16 posted on 02/16/2011 7:56:07 AM PST by ken5050 (Admin Moderators rule!!!!)
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To: pnh102

With the exception of a first-degree murder case where the death penalty is involved, nothing will get you harsher treatment in the U.S. criminal justice system than a financial crime that costs a lot of wealthy people and financial institutions a lot of money and damages the credibility of our financial system — especially if they come out looking like fools in the process.


17 posted on 02/16/2011 7:59:58 AM PST by Alberta's Child ("If you touch my junk, I'm gonna have you arrested.")
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To: ReverendJames
Well, I'm not saying any particular bank did or didn't do anything in the Madoff situation. But, I can tell you that when banks become involved in servicing huge accounts like Madoff, they have an interest in understanding the business they're involved with servicing.

A total outsider, Harry Markopolous was able to spot the fraud just on the basis of what Madoff was reporting as returns. Does it really seem to you impossible that banks who were working with Madoff on a daily business might have suspected fraud?

18 posted on 02/16/2011 8:07:05 AM PST by Walts Ice Pick ("I'm not going to shut up!" - Sarah Palin)
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To: Walts Ice Pick

Most likely they turned a blind eye to it.


19 posted on 02/16/2011 8:10:48 AM PST by ReverendJames (Only A Painter Or A Liberal Can Change Black To White)
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To: safetysign
First thing I thought of when I heard this:
1.He found an excuse that could credibly be considered more greedy & hated than he was,
2. He's trying to deflect guilt from the rest of his family,
3. This guy has no remorse.
20 posted on 02/16/2011 8:16:11 AM PST by AmericaUnite
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To: safetysign
It's a wonder the comatose stock holders of JPMorgan Chase don't revolt and throw the rascals out.

The corporation cut dividends to comparative pennies almost a couple years ago and continues to do so despite the big bucks it's raking in.

Anything can be expected when Bill Daley is one of its officers along with CEO Jamie Dimon who's an Obama enabler, donor and footsie-player.

The Daley family tentacles are everywhere, but they've succeeded for endless decades in keeping mostly everything under the radar.

I suspect that Bill and Jamie extract tons of $$$'s and goodies from JPM while the investors are left to suck wind.

Madoff got too big for his britches and his deck of cards was bound to fall apart. The other high finance scam dealers play it cool while they operate in Brooks Brothers suits under legitimate corporate cover. Unlike Bernie, they are very careful and clever in their mendacity....and they succeed inordinately in their particular line of work.

Leni

21 posted on 02/16/2011 8:30:37 AM PST by MinuteGal (OK, BOR...NAME the "far-rightists" you always morally compare to the far-leftists. Name names, NOW!)
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To: ken5050
There were, at last count, 483 Wilpon accounts with Madoff. Wonder what their IRS returns look like (/snix).

Madoff complained in a 2004 phone call to one of Katz's business associates, Arthur Friedman, vice president of Sterling Equities that his BIL, Mets co-owner, Saul Katz told his country club friends that 'nobody knows how Madoff does it,' Katz's blathering likely irritated Madoff because his epic Ponzi scheme depended on an air of mystery and intrigue to ward off regulators and lure customers. IF TRUE, THAN THIS PROVES THAT THE WILPON'S KNEW!

Mets co-owners and their families reaped millions from Bernie Madoff’s schemes:

Fred Wilpon Sterling Equities co-founder; Mets co-owner Earnings: $52.8M from 57 Madoff accounts

Judith Wilpon Fred’s wife Earnings: $24.7M from six Madoff accounts

Iris Katz Saul’s wife Earnings: $35M from six Madoff accounts

Saul Katz Sterling Equities co-founder; Mets co-owner Earnings: $45M from 68 Madoff accounts

Jeff Wilpon Fred and Judith’s son, Sterling exec VP, Mets COO Earnings: $37M from 62 Madoff accounts

Richard Wilpon Fred’s brother, Sterling Equities partner, Mets board member Earnings: $23.1M from 60 Madoff accounts

Michael Katz Saul’s brother, Sterling Equities partner, Mets board member Earnings: $19.1M from 59 Madoff accounts

Heather Katz Knopf Saul and Iris’ daughter Earnings: $33M from 44 Madoff accounts

SOURCE http://www.nypost.com/p/news/local/amazin_kin_all_had_to_bern_dwIueqtoYrU2uhjaoXEUaL

22 posted on 02/16/2011 9:08:03 AM PST by Liz
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To: Liz

Looks to me like the Katz is out of the bag......


23 posted on 02/16/2011 11:53:11 AM PST by stephenjohnbanker
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To: stephenjohnbanker

Heh——cute.


24 posted on 02/16/2011 12:25:10 PM PST by Liz
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To: Liz; ken5050; stephenjohnbanker
What hogwash, this is Bernie's equivalent of "They should have stopped me before I destroyed people with my Ponzi scheme". Sounds like Bernie and his friends at NYTimes are trying to publicize and "substantiate" Irving Picard's lawsuits of "deep pockets" and shield Bernie's friends and family from responsibility and accountability. Schemers to the end, and the end is not in sight.

From Face-to-face at JPMorgan Chase - NYP, by Mark DeCambre, 2011 February 16

In 1980s Madoff had his fund's account with Chemical Bank;
in 1992 Chemical bought Manufacturers Hanover Trust (Manny Hanny);
in 1996 Chemical Bank merged with Chase Manhattan Bank and assumed Chase name;
in 2000 Chase bought / merged with JPMorgan to form JPMorgan Chase;
in late 2004 JPMorgan Chase bought Chicago's Bank One;
shortly after the merger Bank One's President and COO Jamie Dimon became Chairman, President and CEO of JPMorgan Chase (current JPMorgan's corporate Headquarters at 270 Park Ave., NY, NY have been HQ of Manufacturers Hanover since it acquired the original Union Carbide Building in 1981.)

Interesting to note that Madoff had "liquidity problems" at the end of 2005; it suggests that he might have had unusually high rate of redemptions / withdrawal from his fund and had to to cover it by getting fresh capital, promising a higher rate of return in a "special investment opportunity" (as he did with Wilpons).

From Madoff Trustee Sues JPMorgan Chase (primary banker sued for billions; facilitated money-launder) - AT, by Michael Cohn | FR posted by Liz, 2011 February 06

As we know, Madoff's fund activity was run from affiliate office in London (similar to MO of Joseph Cassano's AIG Finanical Products London division which wrote most of the toxic CDSs, and Al Gore's GIM - Generation Investment Management - which is in the business of investing in "sustainable green" fraud) and the SEC, FInRA and NY / US South District Attorneys apparently already have turned the blind eye to investigating Madoff despite much more substantial tips from other sources (Markopolos et al), so going to UK's SOCA made a lot more sense and was a serious step, yet it was still based on nothing "substantial." And this was done in the middle of unfolding possible financial collapse, when something like this was hardly a priority for financial institutions trying to survive or helping others to survive. Apparently SEC staffers were very "inexperienced" (according to the report of SEC IG Katz) or may be too busy "googling" porn, rather than googling or auditing Madoff.

Basically, the Picard's thesis is that the banks and funds should have been not only doing due diligence on Madoff for the purpose of determining if they want to invest with him, but also doing the job of the SEC, FInRA, SAGs/DAGs and the FBI to document and report any possible potential fraud, based on nothing more than something is "too good to be true". How about starting with Social Security, defined benefit pensions and other pay-as-you-go U.S. government schemes... er, "programs"?

From From Prison, Madoff Says Banks ‘Had to Know' of Fraud - CNBC / NYT, by Diana Henriques, 2011 February 15

Interesting how little he cares about anybody who may have unsuspectingly invested life savings with him or with the funds that invested with him, other than his family or friends.

Here's the big one. He claims that his family members, who were sophisticated elite members of NASD, worked at his firm, were at his side almost every day, knew nothing about the scheme, yet the bank that held his account for more than 20 years was supposed to know he ran a Ponzi scheme and report on him to the authorities who would actually then stop him, so there would not be so much destruction to his family? Nice try, Bernie.

Well, before Picard and his "deep pockets" lawsuits Madoff couldn't have come up with this, he meant alone as in "my friends and family didn't know"... now, that the "deep pockets" might pay off his victims - hey, that can change the entire game. Irving Picard, you found some great scapegoats that anyone can hate - sounds good, NYTimes and I will play along.

The banks and investors "had to know" (apparently they just could Google it) but the people closest to him, working with him, living with him, scheming with him - "didn't know." Yep, the game is afoot...

So at the same time he says the banks and the funds "had to know" about his Ponzi scheme, he is surprised that they even suspected that anything was wrong or "too good to be true"... "It's all their fault... They didn't stop me from defrauding and now look at my poor family." The game goes on...

Madoff met several times (at least twice) with Picard and his legal team, and gave them information he thought would be "instrumental" in helping to recover assets from people who were "complicit" in his scheme. I'll bet they are not FOBs / "Friends of Bernie". Yet he had not shared any of this information with federal prosecutors who worked on criminal cases because he only wanted to help recover assets, not criminal evidence. Having it both ways, again...

Fred Wilpon and Saul Katz? Why, "they knew nothing. They knew nothing."

Entire article is trying to build support for Picard's lawsuits, but Madoff contradicts himself at every step. His goal is still to do everything that he can to protect his family and friends, and Picard is complicit with that, as long as he can keep the game going for a while and grab as much money from the legal abuse of the expensive and time-consuming "deep pockets" and "class action" type lawsuits.

Here is pièce de résistance that gives away their "deep pockets" game:

Quintessiential Madoff's scheme - protecting his friends and family from criminal and financial consequences by pointing fingers at others who could be made "accountable" for his schemes... even from behind the country-club prison walls.

But can Picard explain why he gave pass to Bernie's "surrogate father," Norman F. Levy, who, according to SIPC, transferred more than $83 billion in and out of his account just between 1998 and 2001? BTW, Levy died in 2005, and it's possible that estate withdrew money from Madoff upon his death, thus resulting in or contributing to Madoff's acute "liquidity problem" (see above) in that year.

Madoff ‘Surrogate Father' Moved Billions in Account - BL, by Bob Van Voris, 2011 February 11

Or why Picard quietly settled with some other "net winners" FOBs for less than he could have if he used legal "strong-arm tactics" he is using in his "deep pockets" lawsuits?

Madoff Trustee May Do What Bernie Didn't: Give Victims Profit - BL, by Bob Van Voris, 2011 February 11

On the ironic side, Madoff pal sued by kin - NYP, by Bob Fredericks, 2011 February 10

Cohmad was named as a combination of Cohn and Madoff.

25 posted on 02/16/2011 9:11:30 PM PST by CutePuppy (If you don't ask the right questions you may not get the right answers)
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To: safetysign

26 posted on 02/16/2011 9:14:30 PM PST by Revolting cat! (Let us prey!)
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To: proxy_user

The OIG report would have mentioned reports coming from banks. The OIG report mentioned other confidential reports and tips, reports from options houses, etc.

No mention of banks reporting suspicious money transfers, structured transactions, etc.


27 posted on 02/16/2011 11:04:17 PM PST by NVDave
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To: NVDave

Under Federal law, it is illegal for either the bank filing a a SAR or the government to reveal the existence of the SAR to anyone.


28 posted on 02/17/2011 4:09:00 AM PST by proxy_user
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To: safetysign

So the banks ‘had to know’ but there was no way that his kids, who worked in the company itself, could know? Come on, Bernie!


29 posted on 02/17/2011 4:11:18 AM PST by K-Stater
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To: NVDave

therefore they have failed in their fiduciary duty to their depositors and investors.

Not a lawyer, but isn’t that a criminal offense.


30 posted on 02/17/2011 4:15:24 AM PST by wita
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To: Liz

You have got to be kidding, this is money in the bank, not money lost after Bernie was “discovered”.

I’m afraid I still don’t understand how big this scheme was.


31 posted on 02/17/2011 4:29:21 AM PST by wita
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To: wita

It is if they knew about these issues and then signed the earnings statements, it is.

Remember, Sarbanes-Oxley has criminalized CEO’s and CFO’s signing off on financial statements that they know are not correct. There are criminal penalties now for a CEO and/or CFO signing off on statements made to the SEC concerning financials of a company when they know there are misrepresentations being made.

The trouble is, this law, like so many others, is not being enforced. We supposedly passed SarbOx into law in 2002 in the way of the Enron scandal to prevent it from happening again. Well, it has happened again, only in a much larger, systemic way in the banking sector.

There are huge opportunities for the SEC making criminal referrals out of the 2008 melt-down if they’d use SarbOx, because there’s no question that the CEO’s and CFO’s knew that their financials were BS. Heck, when Erin Callan could not keep a straight face on a phone call, that was effectively the beginning of the end for Lehman. She should have been charged, because she clearly knew that their financials were not in order as the short-sellers were hammering her with questions.

Same deal with the Madoff scandal. Billions of dollars were being flung around the banking system by Madoff... and bankers didn’t ask questions why these large amounts were being shell-gamed?

As in so many other areas of the law, we don’t need new laws. All we need to do is enforce the ones we have. Sadly, the bankers have received a “get out of any inconvenient questions free!” card from the DNC and GOP.


32 posted on 02/17/2011 11:14:35 AM PST by NVDave
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To: proxy_user

The government may reveal the existence of a SAR ‘in performance of their official duties’ - which for the OIG (and SEC, FinCEN, et al) would mean disclosure during an investigation.

The OIG wouldn’t even have to reveal the content of the report. If a report had been filed by one or more banks, the name of the filing bank wouldn’t necessarily have to be revealed.

The OIG would have said merely stated in their report that SAR’s were filed as part of their post-mortem on how Madoff evaded SEC investigation, because a SAR being filed would have been a big red flag that should not have been ignored by the OCC, FBI or Federal Reserve. The OIG revealed plenty of other confidential information in their report, in semi-redacted manner for the public report, laying out the breadth and scope of the information that the government had on Madoff and yet chose to ignore.

Remember, we’re talking of billions of dollars here.

That the OIG report is silent on the issue means to me that the bankers went along with this scam - and why wouldn’t they? Their bread was being buttered with the very best butter.


33 posted on 02/17/2011 11:28:20 AM PST by NVDave
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To: NVDave

Well, remember that a SAR under the AML laws is basically a computer implementation of Fed regulations that automatically generates the SARs. Presumably, they are reviewed by someone before being filed, but this would typically be a low-level DDA account auditor/security enforcer.

It is possible that he saw the who the account was, asked his boss, and go told “it’s OK” based on the presumed nature of Madoff’s business. But no banker would dare risk suppressing these reports for business reasons. The banks usually have rules prohibiting even talking to the customer’s relationship manager about such matters.


34 posted on 02/17/2011 11:54:55 AM PST by proxy_user
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To: proxy_user

FWIW, JPM filed a SAR to the British authorities just before Madoff’s scheme blew up.

http://abcnews.go.com/Blotter/page?id=12297036

As the Madoff Trustee’s filing on 2/4/2011 indicates, there were automated systems flagging Madoff’s transactions... yet JPM was not filing reports.

http://www.madofftrustee.com/CourtFilings-Download.aspx?Docket=805

(you have to suffer through a lot of “redacteds” in this filing... - but start reading around p. 60...)

For those who don’t want to wade through the complaint, here’s the one nugget therein:

“222. JPMC also faced regular account activity that would have been suspicious regardless of the type of business JPMC thought Madoff was running. The 2000 OCC BSA/AML Handbook identified numerous “red flags” that financial institutions needed to consider as part of their transaction monitoring procedures. These red flags included: (a) unexplained repetitive or unusual patterns of activity; (b) frequent large dollar transactions without corresponding explanations as to how those funds would be utilized; (c) spikes in customer activity with little or no explanation; and (d) wire activity with offshore banking centers or financial secrecy havens. The 703 Account exhibited all of these types of transactions, and exhibited them repeatedly.”

JPM had him dead to rights. The filing to the UK office makes it clear that other parts of JPM viewed Madoff’s activity as suspicious, especially as massive fund outflows were being seen.


35 posted on 02/17/2011 11:56:47 AM PST by NVDave
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To: proxy_user

You’re right, I *agree* with you, and that is how it works.

But the GAO found that SAR filings are increasing, and it wonders whether SAR’s are being filed as a “CYA” by the bankers, possibly flooding the system with noise:

http://www.gao.gov/new.items/d09226.pdf

Why, given the filing in the UK, would JPM have kept looking the other way?

Well, the amount of business they had with Madoff, and the loans they extended to him... that might color their opinion on whether or not to kick over this particular hornet’s nest. Especially, when one considers the amounts, it would really draw some attention within FinCEN...

If you or I worked at JPM, I’m sure we could have been covering our tushies with a SAR — especially considering the amount being wired to “high risk” offshore locations. That’s a big red flag for the FBI for drug money and terrorism now...


36 posted on 02/17/2011 12:02:05 PM PST by NVDave
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To: CutePuppy

Thanks for the info, CP!


37 posted on 02/17/2011 3:57:45 PM PST by stephenjohnbanker
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To: stephenjohnbanker; Liz; ken5050; All
The NYTimes interview with Madoff seems to have gone down like a lead balloon. The fallout seems to confirm conclusions in my post:

From Madoff’s Credibility Ends When His Mouth Moves: Ann Woolner - BL, by Ann Woolner, 2011 February 17

Good comments in the article on what Madoff didn't say, and didn't offer any proof or specifics (particularly referring to JPMorgan and other non-FOB parties accused by him and Picard of being "complicit in one form or another" in his crimes or "should have known" about them). Picard would have to rely on Madoff's testimony to prove to the courts that institutions knew about the specific crimes he accuses them of, rather than vague statements that they "should have known" or "had to know."

Conclusion: there is no evidence of JPMorgan's knowledge or involvement in Madoff's scheme in 115-page lawsuit that was filed by Picard to bankruptcy court - wrong legal venue, at that.

And now, at last, tables are being turned on Bernie's new partner - Irving Picard - in their latest efforts to make everyone happy by deflecting the blame, protection of FOBs and "deep pockets" legal extortion schemes. He is getting deserved backlash from real victims for quietly shielding FOBs (Friends of Bernie) by favorable settlement terms and thus keeping the damaging info from criminal prosecutors:

From Madoff victims file to stop $220M deal - NYP, by Chuck Bennett,

The irony here is delicious - Picard is now on the hot seat and his spokesman called Chartma's motion "without merit".

Here is an interesting mini-Madoff episode that shows why Madoff's "consistent" or "stable" results were so effective as a sales pitch to certain demographic (and why he was really surprised to find that there were people doubting his returns and his scheme):

From Fugitive Kim used Bernie M.O. - NYP, by Kaja Whitehouse, 2011 February 18

In the aftermath of Madoff confession "stable returns" became a red flag for fraud watchers. 35-year old Kim, immediately changed his MO and "returns" - in January, 2009 Kim replaced the 0.14 number with returns that were still unusually consistent, but slightly varied and not identical from month to month.

Another "affinity" or "identity" mini-Madoff Ponzi schemer (this one Amish, of all people) seems to have gotten little more than a slap on the wrist:

From 77-year-old Amish financial adviser charged in Ponzi scheme - NYP, 2011 February 17

And another "sleeper" Madoff-like (too big and too different to call it mini-Madoff) Ponzi soap opera just became even more interesting:

Stanford Sues U.S. Prosecutors, SEC and FBI Agents - BL, by Andrew M. Harris and Laurel Brubaker Calkins, 2011 February 17

SEC spokesman Kevin Callahan and DoJ spokeswoman Laura Sweeney declined to comment, FBI Houston's office PR person Shauna Dunlap has yet to return the call.

Stanford's 39-page lawsuit doesn't sue the agencies directly, but names 12 persons working for the SEC, FBI and the DoJ as defendants. Complaint includes attorney Stephen Korotash who leads the SEC’s civil suit and criminal case prosecutors Gregg Costa and Paul Pelletier.

Stanford accuses individuals of "abusive law enforcement", denying him the "constitutional rights," right of legal defense, in part by intimidation and freezing "his" accounts, and seeks $7.2 billion in damages.

38 posted on 02/19/2011 4:52:36 AM PST by CutePuppy (If you don't ask the right questions you may not get the right answers)
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To: CutePuppy; ken5050

Seems to me the whole purpose of the Madoff exercise was to get the Wilpons off the hook-—to clear the Wilpons of any wrongdoing.

Not that I believe it.

And even if they did NOT know-—the Wilpons still have to give back any monies they made which are considered ill-gotten gains....said to be some $300 million.

By law, one cannot benefit from financial fraud.


39 posted on 02/19/2011 5:25:55 AM PST by Liz (A taxpayer voting for Obama is like a chicken voting for Col Sanders.)
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To: Liz; CutePuppy
In the article that CutePuppy posted, ( #38) Levy is said to have "moved $100 BILLION.."

This doesn't make sense. It's generally agreed that the maximum amount of actual CASH that BM took from investors...not the fictional profits..was just over $20 billion...

Thoughts?

40 posted on 02/19/2011 7:10:10 AM PST by ken5050 (Admin Moderators rule!!!!)
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To: ken5050; CutePuppy

I believe the $100B is accurate.

Refers to TOTALS Levy moved in and out-—not the actual amt “invested” at one time.

Such a large amount being moved might also reinforce the suspicion that Madoff was laundering Russian mob money.


41 posted on 02/19/2011 8:11:07 AM PST by Liz (A taxpayer voting for Obama is like a chicken voting for Col Sanders.)
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