Skip to comments.From Prison, Madoff Says Banks ‘Had to Know’ of Fraud
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 ...
And giving a far better bang for the buck, apparently.
What constitutes ‘knowing’?
If you mean having sufficient evidence to convict Mr. Madoff in a court of law, nobody had that until he confessed.
He will have a heart attack soon.
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.
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.
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.
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.
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 Streets 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 (19891990) 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 JPMorgans request. The suit aims at recovering $1 billion in fees and profits that JPMorgan earned as the primary banker to Madoffs firm and by structuring Madoff-related derivatives. Picard also wants more than $5 billion in damages. (Excerpt) Read more at businessinsider.com ...
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.
Because only Fedzilla gets to run a Ponzi scheme.
I don’t understand your confusion. Could you explain?
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?
The banks “had” to know, but he also said that the Wilpons had NO idea...yeah..right..
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.
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?
Most likely they turned a blind eye to it.
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