Free Markets, Free People

Bernie Madoff

The Case Against “Not Enough Regulation” Causing Financial Meltdown

The case against?

Bernie Madoff, of course.  A man who bilked investors of some 80 plus billion dollars over a couple of decades knew how to fool the regulators and was not shy about passing on that information to those who worked for him.

Money quote (no pun intended):

“You know, you don’t have to be too brilliant with these guys because you don’t have to be …”

Apparently the regulation regime, which should have easily have caught Madoff, failed too because regulators got to cozy with him:

“The guys . . . ask a zillion different questions and we look at them sometimes and we laugh, and we say, ‘Are you guys writing a book?’ ” he said.

“These guys, they work for five years at the commission then they become a compliance manager at a hedge fund now.”

Yeah – we need more regulations. That’s the ticket. More. That’ll fix it.

The regulations were there – the regulators, however, failed to enforce them. My guess is that a close examination of why we ended up in the financial pickle we did had less to do with the lack of regulation and more to do with what let Bernie Madoff skate for so long – a criminal lack of oversight by regulators as authorized by law.

~McQ

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The Silence Is Deafening (update)

Doug Heye points out something of which I’m sure few people are aware:

The Democratic Senatorial Campaign Committee (DSCC) has apparently decided to keep $100K in contributions from Bernie Madoff, who faces up to 150 years in prison for swindling billions from the likes of Steven Spielberg, Elie Wiesel, Kevin Bacon and Kyra Sedgwick in a massive Ponzi scheme.

In campaigns, one side often calls on the other to return money for one reason or another. Sometimes it’s valid, sometimes not. Regardless, it’s Campaign 101. But when the contributor in question is the single biggest financial criminal in history, there can be no question that those illicit funds should not remain in campaign coffers.

[...]

Given the economic uncertainty our nation faces and that Madoff not only fleeced the rich and famous but major corporations such as HSBC — in other words, Madoff swindled all of us — the DSCC’s decision is shockingly tone-deaf.

No kidding. People all over have been fleeced by this guy, they’re looking all over for assets with which to recover some of the funds and pay back the investors and the DSCC is keeping the funds he sent them. Shocking.

What isn’t shocking, however, is what Heye notes next:

However, what’s almost equally surprising is the virtual silence from the media. During the Enron scandal, returning campaign money was a daily drumbeat, as were the news stories discussing Enron’s purported ties to President Bush. Now, when the Democratic Senate campaign vehicle makes the conscious decision to keep $100K in Madoff money, stolen just as if it came from a bank holdup, there’s little to no outrage.

Heye seems surprised and asks “why” this is receiving no coverage.

Most of the rest of us are just shaking our heads knowingly and are not at all surprised by that fact.

UPDATE: Commenter Linda Morgan provides a link from the Washington Times, apparently the only MSM outlet which carried the story, with some positive results:

One day after The Washington Times reported that a key Democratic fundraising group was holding onto $100,000 from disgraced financier Bernard Madoff, the Democratic Senatorial Campaign Committee decided to donate the money to his victims.

“We’re reviewing this internally, and decided to give the money to the trustee for distribution to the victims,” DSCC spokesman Eric Schultz told Roll Call on Thursday.

Given the fact the Madoff scandal is old enough that he’s been to trial, plead guilty and is awaiting sentencing, you have to wonder why it has taken this long for the DSCC to “review this internally”.

~McQ