|  | | 2008 News and Press Releases | | |
HEADLINE NEWS:
Madoff Was Magnet For Some, Not All, Investors
Jim Zarroli
http://www.npr.org. December 16, 2008
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EXCERPT: The FBI says it has set up a hotline for investors who believe they were cheated by money manager Bernie Madoff. Officials are hoping to collect any documents or other evidence that might shed light on how the scandal unfolded. […] But at some point Madoff also began attracting money and lots of it — some $17 billion for an array of distinguished clients. The SEC is supposed to inspect registered investment advisers on a regular basis. And they have the authority to look at their books anytime. But Joseph Grundfest, a professor of law and business at Stanford University, says the commission doesn't pursue such firms very aggressively. "There are thousands of these firms out there and the SEC's inspection schedule doesn't allow it to get to them on a frequent basis," says Grundfest. Why is that? Grundfest says it is a question of resources and money. But critics note that the SEC had received at least one complaint about Madoff's investment practices as far back as 1999. A securities industry executive warned that Madoff's returns were too good to be true and urged it to investigate him. Yet Madoff was able to keep operating and even register as an investment adviser in 2006. SEC officials say they can't discuss what they knew or didn't know about Madoff because the case against him is still open. What is clear is that U.S. officials appear to have done little to stop Madoff, even though a lot of other people in the financial markets were raising questions about him. |
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