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Tonight the Inspector General of the Securities & Exchange Commission gives us Bernie Madoff in his own words — A jailhouse interview that Madoff granted to the SEC’s watchdog during his stay at Metropolitan Correctional Center in lower Manhattan on June 17. Madoff spent much of the interview slamming the SEC: “Everything the SEC did prior to 2006 was a waste.” He said that the inspectors who combed through his books found only “ridiculous violations.” Madoff adds that he never supplied false documents to the SEC, but that it was “amazing to me” that he didn’t get caught.

Madoff: It's 'Amazing' I Didn't Get Caught Sooner Posted By: Scott Cohn Senior Correspondent, CNBC 30 Oct 2009 | 07:26 PM ET Jailed swindler Bernie Madoff said it was "amazing" that he didn't get caught sooner in his multi-billion-dollar Ponzi scheme, and that everything the SEC did to investigate him prior to 2006 was a waste of time, according to a jailhouse interview he gave to SEC Inspector General H. David Kotz. Madoff also told Kotz that SEC Chairwoman Mary Schapiro was a "dear friend," although she "probably thinks, 'I wish I never knew this guy.'" For the SEC's Full...

Under the Senate Finance Committee bill, HHS Secretary Kathleen will determine the meaning of terms such as "physician services," "premium," "prescription drug coverage," "deductible," and "emergency room care.

Goldman Sachs Defends Dark Pools, Short Selling By JOAN E. SOLSMAN Goldman Sachs Group Inc. defended a range of trading practices currently under regulatory scrutiny, including dark pools and short selling, in a report to the Securities and Exchange Commission and a series of posting on its Web site. In defending dark pools, private venues where large blocks of securities are traded anonymously, Goldman said they are simply the result of technology improving on the kind of non-displayed liquidity that has always existed in the market. The firm, which has reaped huge trading profits in the last two quarters, said...

WASHINGTON -- The Securities and Exchange Commission tapped Goldman Sachs Group Inc. executive Adam Storch on Friday to serve as the agency's first-ever chief operating officer of the enforcement division. The new hire represents the latest personnel change at the SEC in its effort to improve its operations following its failure to detect Bernard Madoff's massive Ponzi scheme. Enforcement Division Director Robert Khuzami created Mr. Storch's position of managing executive as part of the major re-structuring effort he announced earlier this year. Mr. Storch will oversee division operations that include budget, information technology and administrative services. He will also supervise...

BIRMINGHAM, Ala. -- The Southeastern Conference has suspended officials from last weekend's Arkansas-Florida game after the crew was involved in its second controversial call of the year. Referee Marc Curles' crew called a personal foul on Arkansas defensive lineman Malcolm Sheppard in the fourth quarter as the Gators were rallying for a 23-20 victory. The league said there was no video evidence to support the call.The same group of officials called the LSU-Georgia game earlier this month, which included a late unsportsmanlike conduct penalty the league said shouldn't have been called. "A series of calls that have occurred during the...

Court papers claim Bernie Madoff's Securities offices were fueled by cocaine, topless women Bernie Madoff, cocaine kingpin? New additions to a lawsuit against the jailed Ponzi schemer charge that he presided over an office so fueled by the drug that it was known as the "North Pole." The suit, filed Tuesday night in Manhattan Supreme Court, alleges that Madoff, as far back as 1975, used two street toughs on his payroll to set up a cocaine pipeline into the offices of Madoff Securities. It portrays the firm's headquarters as an animal house with "a culture of sexual deviance" that often...

Senator Schumer Begins Dark Pool Crack Down Submitted by Tyler Durden on 10/20/2009 08:52 -0500 Dark Pool Dark Pools Mary Schapiro New York Stock Exchange NYSE Schumer SEC Securities and Exchange Commission Senator Schumer WASHINGTON, DC—U.S. Senator Charles E. Schumer (D-NY) will hold a conference call with Duncan Niederauer, CEO of the New York Stock Exchange (NYSE), on Tuesday, October 20, 2009 at 12:30 pm to urge the Securities and Exchange Commission (SEC) to institute a series of reforms to better regulate dark pools. Schumer will release a letter he is sending to SEC Chairwoman Mary Schapiro urging several different...

After being knocked halfway to kingdom come, Tim Tebow knew that millions of college football fans would be paying close attention to his eyes the next time he led the Florida Gators into action. Viewers would be looking for signs that the quarterback was OK after a nasty concussion. Many would also want to see which Bible reference would be written in the patches of eye black that would be visible whenever television cameras focused on the face of America's most famous muscular Christian. Tebow was wearing Isaiah 40:31 when he got hurt against Kentucky: "But they that wait upon...

<p>On Tuesday, March 11th, 2008, somebody — nobody knows who — made one of the craziest bets Wall Street has ever seen. The mystery figure spent $1.7 million on a series of options, gambling that shares in the venerable investment bank Bear Stearns would lose more than half their value in nine days or less. It was madness — "like buying 1.7 million lottery tickets," according to one financial analyst.</p>

WASHINGTON – A Goldman Sachs executive has been named the first chief operating officer of the Securities and Exchange Commission's enforcement division. The market watchdog says Adam Storch, vice president in Goldman Sachs' Business Intelligence Group, is assuming the new position of managing executive of the SEC division.

Two former investors are suing the Securities and Exchange Commission for $2.4 billion in damages, claiming the agency acted with negligence while examining Ponzi schemer Bernard Madoff's investment business. The 63-page complaint, filed by Phyllis Molchatsky and Dr. Steven Schneider, claims the agency engaged in "serial, gross negligence" over the course of 16 years. It alleges that because the SEC's negligence occurred during the course of its regular functions, rather than when crafting policy, the agency is not shielded by the doctrine of sovereign immunity. .....

One of those hopefully seminal moments, when someone, somewhere decided to take a stand against the perpetual engine of corruption, greed, and cronyism. From Judge Rakoff's Order For example, the Consent Judgment would effectively close the case without the S.E.C. adequately accounting for why, in contravention of its own policy, see Order, 8/25/08 (quoting the policy), it did not pursue charges against either Bank management or the lawyers who allegedly were responsible for the false and misleading proxy statements...

WASHINGTON (Reuters) – After bungling five probes that should have uncovered Bernard Madoff's $65 billion fraud, regulators must learn to aggressively investigate tips and complaints to catch wrongdoers, the U.S. Securities and Exchange Commission's internal watchdog said on Thursday. A scathing report issued last week by SEC Inspector General David Kotz found that the agency missed numerous red flags, did not properly follow up on leads and dismissed tips and complaints that might have uncovered Madoff's investment sham. At a congressional hearing to examine the SEC's shortcomings, Kotz outlined dozens of recommendations to improve SEC procedures for handling tips and...

The Securities and Exchange Commission's watchdog has recommended "employee-by-employee" action to ensure the agency fixes the breakdowns that allowed Bernard Madoff's colossal fraud to go undetected for years.

WASHINGTON (Reuters) – Bernard Madoff's whistle-blower and the U.S. Securities and Exchange Commission's top enforcer will testify before Congress this week on how the SEC failed to uncover Madoff's $65 billion fraud, a congressional panel said on Monday. Harry Markopolos, a fraud examiner who tried to warn regulators that Madoff's business was a fraud, and the SEC's Director of Enforcement Robert Khuzami are expected to testify at the Senate Banking committee's hearing on Thursday.

Imagine power companies spending millions of dollars on ads in the run-up to the 2010 midterm elections accusing congressmen who supported climate change legislation of trying to increase electric rates and urging votes against them, or unions buying airtime to support primary challenges to conservative Democratic senators who opposed the labor-backed Employee Free Choice Act. Or even healthcare companies saturating the airwaves with messages urging voters to deny President Obama a second term. All those ads would be illegal under current election law. But the Supreme Court will hear arguments Wednesday in a case that challenges decades of restrictions on...

That Bernard Madoff’s multi-billion dollar fraud flourished for many years under the nose of the Securities & Exchange Commission is a powerful indictment of the SEC as a complicit handmaiden of Wall Street corruption of enormous scale. The SEC Inspector General, who is supposed to be autonomous but strangely must submit his reports directly to the agency he is required to watchdog, has been investigating how this so-called specialty regulator managed to miss such rampant fraud for so long. On September 2, the SEC released an “executive summary” of 22 pages signed by the IG David Kotz August 31. Its...

Former U.S. Securities and Exchange Commission chairmen and directors were generally unaware that staff were probing Bernard Madoff until the former financier was arrested in December 2008 for running a $65 billion Ponzi scheme, a federal watchdog said in a report released on Friday. The report underscores the disconnection between senior officials and their employees, who often lacked the experience necessary to follow up on leads and understand the magnitude of their investigation. Former Chairmen Christopher Cox, William Donaldson and Arthur Levitt, former director of enforcement Linda Thomsen and former director of examinations and compliance, Lori Richards, did not play...

"In the examination of Madoff, the SEC did not seek records from the Depository Trust Company(DTC)(an independent third-party), but sought copies of such records from Madoff himself..." "Had they sought records from the DTC, there is an excellent chance that they would have uncovered Madoff's Ponzi scheme in 1992." Source: SEC Inspector General

WASHINGTON (CNNMoney.com) -- The Securities and Exchange Commission overlooked "more than ample" evidence, including six complaints, that red-flagged the Bernard Madoff Ponzi scheme, an internal watchdog said Wednesday. A broad review of the SEC and its efforts at tracking Madoff found a "thorough and competent investigation was never performed." "Despite numerous credible and detailed complaints, the SEC never properly examined or investigated Madoff's trading and never took the necessary, but basic, steps to determine if Madoff was operating a Ponzi scheme," according to a 22-page SEC inspector general report.

WASHINGTON (Reuters) – U.S. securities regulators fumbled five probes of Bernard Madoff's operations and missed opportunities to uncover the financier's $65 billion investment fraud, a report by the U.S. Securities and Exchange Commission's inspector general said on Wednesday. The SEC received more than ample information over the years to warrant a thorough and comprehensive examination or investigation of Madoff and his firm, the report said.

Securities regulators are examining weekly meetings at Goldman Sachs Group Inc. in which research analysts give tips to traders and then to big clients, as the Wall Street giant considers disclosing these so-called trading huddles to all its clients. The Wall Street Journal reported Monday that analysts at Goldman sometimes shared with traders and key clients short-term trading tips that sometimes differed from the firm's long-term research. Examiners at the Financial Industry Regulatory Authority, the industry self-regulatory body known as Finra, and the Securities and Exchange Commission intend to ask Goldman for more information on these weekly get-togethers, people familiar...

Georgia’s only corn ethanol plant could be running out of gas. First United Ethanol LLC has limited liquidity and could slip into the arms of bankruptcy protection, the company warns in filings with the Securities and Exchange Commission.

The industry self-regulatory organization that was supposed to police the brokers at the Stanford Financial Group acknowledges that a Stanford employee alleged in 2003 that the company was running a Ponzi scheme, but the organization did not follow up on the claim based of its own policy, which has since been changed. The disclosure comes in testimony from Daniel Sibears, Executive Vice President of the Financial Industry Regulatory Authority, FINRA, prepared for a Senate Banking Committee hearing on Monday. In 2003, Stanford advisor Leyla Wydler alleged in an arbitration case that the company was "engaged in a Ponzi scheme to...

The Commodities Futures Trading Commission (CFTC) wrapped up its hearings on whether to install position limits on futures trading this week, and like other hot topics being tossed around Capitol Hill, misinformation seems to be running rampant. One myth is that speculators only bet on prices going higher. The chart below shows both long and short futures positions for all commodities. While it's definitely not a one-to-one ratio, the chart shows that investing in futures is a two-way street, with investors lining up on both sides. Another myth is the overall size of the speculative market. According to a recent...

HARRY Markopolos -- the whistleblower on Bernie Madoff who proved to be much smarter than the SEC -- says there are evildoers out there who will make the Ponzi scum "look like small-time." Markopolos gave a speech to 400 of the faithful at the Greek Orthodox Church in Southampton and predicted major scandals will soon be revealed about the unregulated, $600 trillion, credit-default swap market.

YOUNG, inexperienced government regulators were so wowed by Bernard Madoff's ritzy Midtown headquarters that they asked about job openings and dropped off resumes while missing clear evidence he was running a massive Ponzi scheme, a new book claims. "No wonder they never found anything," Madoff firm secretary Elaine Solomon told author Andrew Kirtzman for his book, "Betrayal: The Life and Lies of Bernie Madoff," The Post's Dan Mangan reports.

Inexperienced govt regulators were wowed by Madoff's ritzy Midtown hdq .....missing clear evidence he was running a massive Ponzi scheme. Madoff firm secretary Elaine Solomon, who worked for Madoff's younger brother, Peter, and who did not know about the fraud, told author Andrew Kirtzman for his book, "Betrayal: The Life and Lies of Bernie Madoff." Solomon said the arch-fraudster got anxious every time the SEC came knocking. "But he needn't have worried," Kirtzman writes. The youthful SEC staffers were dazzled to be at Madoff headquarters. When SEC probers showed up at Madoff's office after his arrest, Solomon recognized one from...

General Electric Co. will pay a $50 million civil penalty to settle charges by the Securities and Exchange Commission accusing the conglomerate of improper accounting in order to make its financial results appear more attractive to investors. Related Quotes Symbol Price Change GE 13.82 0.00 The SEC said Tuesday that GE violated U.S. securities laws four times between 2002 and 2003 when accounting for items like commercial paper funding and the sale of train locomotives and aircraft engine spare parts. The SEC said the changes helped GE maintain a string of earnings that beat Wall Street expectations each quarter from...

The Securities and Exchange Commission has promised to ban a controversial trading practice offered by stock exchanges that include Lenexa-based BATS Exchange Inc. Sen. Charles Schumer, D-N.Y., said in a release Tuesday that SEC Chairwoman Mary Schapiro told him in a personal phone call of the regulatory agency’s plans to ban flash trading, which momentarily lets certain traders know of stock orders before they’re released to the public market. BATS and Nasdaq have welcomed scrutiny of the practice. Last month, Schumer sent a letter to the SEC saying that it should ban flash trading or that he would introduce legislation...

The Securities and Exchange Commission accused Bank of America on Monday of misleading investors about plans to pay billions of dollars in bonuses at Merrill Lynch, the troubled brokerage giant it bought last year. The development once again turns an uncomfortable spotlight on a defining moment of the financial crisis — the ill-starred merger of Bank of America and Merrill — and on Bank of America’s embattled chief executive, Kenneth D. Lewis. The $50 billion merger, completed at the behest of federal officials, has been the subject of heated hearings in Congress, as has the question of who knew what,...

LOS ANGELES (Reuters) – Bernard Madoff, the financier convicted for Wall Street's biggest investment fraud, was surprised his $65 billion Ponzi scheme was not uncovered sooner, he said in his first interview since entering prison. Madoff, the disgraced 71-year-old Wall Streeter who drew 150 years' prison time for the fraud, expressed remorse and talked candidly to a pair of lawyers suing him on behalf of investors, according to news reports of their jailhouse meeting on Tuesday. San Francisco attorneys Joseph Cotchett and Nancy Fineman met with Madoff at the North Carolina prison where he was taken two weeks ago after...

Calls by a US senator to ban "flash" orders - trades made at lightning speeds on electronic systems - have met resistance from a leading market provider. Direct Edge, the electronic share trading network, hit back yesterday at comments from Charles Schumer, a senior Democrat on the Senate banking panel, who has called for a clampdown on how equity prices are displayed to investors on electronic systems.

A federal judge threw out the Securities and Exchange Commission's insider-trading charges against Dallas Mavericks owner Mark Cuban, and undercut the SEC's legal argument in a way that could make it more difficult to prosecute similar cases. The ruling by U.S. District Judge Sidney Fitzwater in Dallas was vindication for Mr. Cuban, who maintained his innocence from the day the charges were filed in November. 'snip' Mr. Cuban and his lawyers denied that he was under any obligation not to trade on the information he received. Judge Fitzwater agreed, saying Mr. Cuban would be liable for insider trading only if...

California IOUs can be considered securities, SEC says Agency guidance helps create a secondary market for IOUs, helping with prices By Ronald D. Orol, MarketWatch WASHINGTON (MarketWatch) -- The Securities and Exchange Commission late Thursday issued guidance identifying the IOUs being issued by California as "securities," rather than just obligations of the economically troubled state. The Golden State issued the IOUs last week to conserve cash and pay off bondholders. "The staff of the SEC has expressed its belief that California's recently issued IOUs are 'securities' under federal securities law. As such, holders of these IOUs and those who may...

Well now they've gone and done it: "The staff of the SEC has expressed its belief that California's recently issued IOUs are 'securities' under federal securities law. As such, holders of these IOUs and those who may purchase them are protected by the provisions of the federal securities laws that prohibit fraud in the purchase or sale of securities," the agency said. That was a mistake. Here's why.

"IOUs" the state of California has issued instead of payments amid its budget crisis are "securities" under U.S. law and their holders and potential buyers are protected by anti-fraud law, federal regulators said on Thursday. The determination comes amid efforts by some entrepreneurs to establish a secondary market for the IOUs, which the government of the most populous U.S. state began issuing last week to vendors and to taxpayers owed refunds to maintain dwindling cash for priority payments, including payments to its bondholders.

Note: The following text is a quote: Smart Online CEO and Two Others Found Guilty of Manipulation of Company Stock LEV L. DASSIN, the Acting United States Attorney for the Southern District of New York, announced that DENNIS MICHAEL NOURI, the former Chief Executive Officer ("CEO") and President of Smart Online, REZA ERIC NOURI, a former Smart Online employee and brother of the CEO, and stock broker ANTHONY MARTIN were found guilty today, after a three-week jury trial before United States District Judge DENNY CHIN. According to the Superseding Indictment and the evidence at trial: From May 2005 through July...

If anyone thinks the Securities and Exchange Commission's goal is investor protection, they should read this WaPo article by Zachary Goldfarb. The goal of the SEC is the same as that of all government agencies: 1. To protect their turf 2. Expand their turf SEC investigator Genevievette Walker-Lightfoot clearly had Bernie Madoff in her sights. She knew something was up, outlined her suspicions and what steps should be taken next in examining Madoff. But, at the same time, the SEC was having a turf war with Eliot Spitzer over who would supervise certain mutual fund infractions. Rather than allowing her...

WASHINGTON (Reuters) – A U.S. Securities and Exchange Commission lawyer warned about irregularities at Bernard Madoff's financial management firm as far back as 2004, The Washington Post reported on Thursday, citing agency documents and sources familiar with the investigation. Genevievette Walker-Lightfoot, a lawyer in the SEC's Office of Compliance Inspections and Examinations, sent emails to a supervisor saying information provided by Madoff during her review didn't add up and suggesting a set of questions to ask his firm, the report said. (snip) The newspaper said the SEC staffer raised concerns about Madoff but, at the time, the SEC was under...

Paul E. Kanjorski, the Pennsylvania Democrat, has finally received at least part of the information he requested — more than once — from the Securities and Exchange Commission's inspector general, who is investigating how the agency missed the vast fraud orchestrated by Bernard L. Madoff. On Wednesday, H. David Kotz, the inspector general, released several suggestions on how to improve the S.E.C.'s oversight of the financial industry, including an expanded bounty program that awards tipsters and increased authority for the Public Company Accounting Oversight Board, or PCAOB....

The Securities and Exchange Commission celebrated its 75th anniversary with lavish gala largely paid for by law firms and lobbyists. From the Politico By all accounts, it was an excellent evening. For the 75th anniversary of the Securities and Exchange Commission, the SEC’s Historical Society — an independent, nonprofit organization — threw a lavish dinner for 950 at the National Building Museum. Critics, though, might gawk at the spectacle of a commission that’s been criticized as too close to industry celebrating itself in a dinner paid for largely by firms that have business before it.

Historic swindler Bernard Madoff was sentenced to 150 years in prison Monday for a fraud so extensive that the judge said he needed to send a symbolic message to potential imitators and to victims who demanded harsh punishment. Scattered applause and

Madoff Feeder Cohmad Was Fraud’s ‘Facade,’ SEC Claims (Cannot be posted, per FR rules)

Barack Obama's plan to overhaul the structure of financial regulation leaves in place the split between those regulators who supervise the trading of futures at the Commodities Futures Trading Commission and those who supervise stock trading at the Securities Trading Association. And while there may be good reasons to keep the commissions separate, mostly likely none of those informed the Obama administration's decision. Instead it was probably just cold politicial calculation. Merging the commissions has long been a popular idea with reformers. It was proposed by Hank Paulson when he was Treasury Secretary, and it is supported by many who...

What's interesting is that Connecticut, a state that has for the past three years failed to have passed legislation providing greater transparency in government finances is now calling for more transparency in the private sector.

Senate Banking Committee Chairman Chris Dodd (D-Conn.) seems to at tract friends who, in turn, attract scrutiny from the Securities and Exchange Commission. Thursday, the SEC hit subprime-mortgage giant Countrywide Financial's ex-CEO Angelo Mozilo with a fraud suit for allegedly deceiving investors on the true condition of the company. He was also charged with insider trading. In 2003, Dodd's role on the Banking Committee got him dubbed a "Friend of Angelo" by Countrywide -- and thus eligible for two sweetheart $800,000 loans. The Senate Ethics Committee is -- at a glacial pace -- investigating the circumstances behind Dodd's Countrywide-refinanced mortgages....

The Securites Exchange Commission (SEC) formally charged former Countrywide Financial CEO Angelo Mozilo and two other company executives with civil fraud. The SEC also charged Mozilo with illegal insider trading, an agency spokesman said Thursday. Civil fraud charges also were filed against Countrywide's former Chief Operating Officer David Sambol and ex-Chief Financial Officer Eric Sieracki. Countrywide Financial, the California-based mortgage lender, was a key component to the subprime mortgage crisis in 2007, which was the beginning of the financial decline and current recession in the U.S. Mozilo is the most high-profile individual to face formal charges from the federal government...

Barack Obama's power trip against the SEC would give the banks that melted down Wall Street even more clout than they already had and still have. You can see the giant handprints of Treasury Secretary Tim Geithner (a former top Fed official) and his coterie of banking industry advisers ("Geithner's inner circle jerks") all over this plan to strip the SEC of some of its regulatory power and give it to what he describes as a "retooled" Fed. The SEC has its problems, as whistleblower Harry Markopolos so bluntly pointed out, but the Fed has a radically different setup —...