Madoff expected to plead guilty for running a $50 billion Ponzi scheme in court today. He could spend the rest of his life in prison.
Posts Tagged ‘SEC’
No More Weekends at Bernie’s
Posted: March 11, 2009 in EconomyTags: Bernard Madoff, Economy, Follow the Money, Scandal, SEC
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The Gloves Are Off
Posted: February 19, 2009 in EconomyTags: Economy, Mary Schapiro, Robert Khuzami, SEC, Wall Street
There’s a new sheriff in town at the SEC.
WASHINGTON (AP) – The Securities and Exchange Commission on Thursday named a former federal prosecutor as its new enforcement chief to lead the embattled agency’s drive to strengthen its pursuit of financial fraud.
Robert Khuzami has been a top legal official on Wall Street at investment firm Deutsche Bank since 2004. Before that he worked for 11 years in the U.S. attorney’s office in Manhattan and prosecuted insider trading cases, Ponzi schemes and other financial crimes.
Khuzami, 52, replaces Linda Thomsen, the SEC enforcement director since May 2005. Her departure was announced last week.
Thomsen became a lightning rod for criticism over the SEC’s failure to detect the $50 billion Ponzi scheme allegedly run by money manager Bernard Madoff, despite red flags raised to the agency staff by outsiders over the course of a decade.
The naming of Khuzami by new SEC Chairman Mary Schapiro came two days after the agency accused Texas billionaire R. Allen Stanford in a civil lawsuit of a “massive” $8 billion fraud that lured investors with sham promises of double-digit returns on certificates of deposit.
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Besides leading several major financial fraud cases, Khuzami also prosecuted the “Blind Sheik” Omar Ahmed Ali Abdel Rahman in what was then the largest terrorism trial in U.S. history following the 1993 bombing of the World Trade Center in New York. Ten defendants were convicted of operating a terrorist organization responsible for the bombing, the assassination of Jewish Defense League founder Meir Kahane, and planning bomb attacks on law enforcement and other high-profile targets.
Other than Patrick Fitzgerald, I can’t think of another prosecutor who would scare me more if I were under investigation.
A Hint of Investigations To Come
Posted: February 11, 2009 in UncategorizedTags: Charles Schumer, Economy, FBI, Follow the Money, Richard Shelby, SEC, Senate, Senate Judiciary Committee, Wall Street Bailout
If you needed any more evidence that the heyday of unregulated excess in American capitalism is over, check out this report in the Wall Street Journal.
Public anger over taxpayer-funded financial bailouts is prompting Congress to look for ways to better police the billions of dollars being injected into the same Wall Street firms that many critics believe caused the current economic crisis.
Sens. Charles Schumer (D., N.Y.) and Richard Shelby (R., Ala.) are sponsoring a bill to hire hundreds of new Federal Bureau of Investigation agents and Securities and Exchange Commission investigators to investigate financial fraud. The Senate Judiciary Committee is holding a hearing Wednesday to highlight the issue.
The proposal would provide $80 million to hire 500 new FBI agents and $10 million to add new federal prosecutors and $20 million for 100 new SEC employees. All are going to be focused on investigating white-collar crime, including mortage and financial fraud that many believe helped cause the current global crisis.
The increase in resources is intended to remedy cuts that were made after the Sept. 11, 2001 terrorist attack, which prompted federal law enforcement to focus more on terrorism.
Schumer says the FBI’s mortgage and financial fraud unit has 348 agents, down from 1,000 following the Savings and Loan crisis in the 1980s and 1990s.
If this happens, there will be some very nervous business executives on Wall Street and throughout America, and white collar defense attorneys in the private sector will make an obscene amount of money defending their clients. I would also expect big business to lobby heavily against this proposal and will promise to do a better job at policing itself, but the political reality is that the uproar over the economy and the multiple taxpayer-funded bailouts have Congress and the American people in a very foul mood. They won’t be very sympathetic.
Icepicks and Nukes 