On Sunday night, 60 Minutes aired an interview with Harry Markopolos: The Man Who Figured Out Madoff’s Scheme. Last month, Markopolos supplied similar information to a Congressional panel. By its vary nature, the SEC does not stop a financial crime until happens. As with all prosecutions, the bad act needs to happen before there is … Read more »
Category: Fraud
The Stanford Fraud
Yesterday, the SEC filed a complaint against R. Allen Stanford and three of his companies: Antiguan-based Stanford International Bank, Houston-based broker-dealer and investment adviser Stanford Group Company, and investment adviser Stanford Capital Management. Tuesday morning, the Wall Street Journal reported on Stanford Depositors head to Antigua or Redemptions. Word had gotten out that the authorities … Read more »
Why Don’t Sanctions Deter Fraud?
Meric Craig Bloch theorizes that punishing people who are caught committing fraud is not an effective way to deter fraud. The reasons behind his theory: Employees who commit fraud don’t anticipate getting caught. The threat of sanctions does not deter them because they don’t expect to face them. To deter them, you have to raise … Read more »
Is Your Organization Adequately Prepared to Fight Today’s Workplace Fraud?
EthicsPoint published this webinar focusing on proper and efficient investigations. The presenter was Meric Craig Bloch, VP Compliance and Corporate Investigations of Adecco Group North America. Meric predicted more fraud coming into the workplace as part of this down economy. Managers are focused on making their numbers and it is harder to do. Profile of … Read more »
Madoff in Limerick Form
Freakonomics ran a contest for the best definition for Bernie Madoff in limerick form. They had special guest judge Chris J. Strolin, founder and editor-in-chief of The Omnificent English Dictionary In Limerick Form announce The Winning Definition of “Madoff,” in Limerick Form. The best of the best was #98 by sqlman: His investments’ ascent: like … Read more »
U.S. Senate Hears About Madoff
On Tuesday, the U.S. Senate Committee on Banking, Housing, and Urban Affairs held a hearing on the background and implications of the Madoff scandal: Madoff Investment Securities Fraud: Regulatory and Oversight Concerns and the Need for Reform. Video Archive Member Statements Senator Christopher J. Dodd Witness Testimony Professor John C. Coffee, Adolf A. Berle Professor … Read more »
Madoff Liquidation and Suits Filed Against Madoff
On January 2, 2009, the trustee charged with liquidating Bernard Madoff Investment Securities, LLC issued a notice outlining the requirements for filing SIPC claims. Notice of Commencement of Liquidation Proceeding for Madoff Investment Securities Anyone having a claim or potential claim against BMIS should read that notice. It provides that customers of BMIS must file … Read more »
Madoff Litigation: Can the Lost Billions be Recovered? How?
This post contains my notes from the webinar: Madoff Litigation: Can the Lost Billions be Recovered? How? The Webinar was sponsored by NERA Economic Consulting and produced by The Securities Docket. The slides are available on Securities Docket.com: Materials from Madoff Litigation Webcast. Brad Friedman of Milberg LLP Gerald Silk of Bernstein Litowitz Berger & … Read more »
Irrational Exuberance
In an essay in the Wall Street Journal, Stephen Greenspan explains some of the psychology behind the success of Ponzi schemes: Why We Keep Falling For Financial Scams. The basic mechanism explaining the success of Ponzi schemes is the tendency of humans to model their actions — especially when dealing with matters they don’t fully … Read more »
Gullibility
NPR’s Science Friday has an interesting broadcast on Gullibility. Ira Flatow interview Stephen Greenspan, author of Annals of Gullibility: Why We Get Duped and How to Avoid It. Can science explain why some swindles are so successful? Why are some people more likely to try to buy the Brooklyn Bridge or send money to the … Read more »