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Yahoo News – Madoff dismissed an SEC investigation as a “fishing expedition” and highlighted how investigators develop cozy relationships with firms they are supposed to regulate.
“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?” Madoff said. “These guys they work for five years at the commission then they become a compliance manager at a hedge fund now.”
The SEC’s failure to uncover Madoff’s massive scheme has led the agency to beef up enforcement efforts as it moves to restore investor confidence.
Newsday – Bernard Madoff’s top lieutenant in his Ponzi scheme is scheduled to plead guilty Tuesday to federal charges in what many legal observers believe is a cooperation deal that could lead to trouble for some major hedge fund operators.
Frank DiPascali Jr., 52, of Bridgewater, N.J., had been a key Madoff aide, working in a closely guarded office on the 17th floor of Manhattan’s Lipstick Building, where the Ponzi scheme operated. It was DiPascali, investigators and defense attorneys said, who dealt with the numerous hedge funds and was involved in mailing myriad false account statements sent to thousands of defrauded clients.
New York Times Blogs – The inquiry into corruption at the New York State pension fund started simply enough. Alan G. Hevesi, the former comptroller, was accused of using state workers as chauffeurs for his ailing wife.
But by the time Mr. Hevesi resigned his office in late 2006, investigators for the Albany County district attorney’s office were examining a more troubling problem: allegations that Mr. Hevesi’s associates had sold access to the state’s $122 billion pension fund, using one of the world’s largest pools of assets to reward friends, pay back political favors and reap millions of dollars in cash rewards for themselves, The New York Times’s Danny Hakim and Mary Williams Walsh reported.
New York (HedgeCo.Net) – Bernard Madoff will continue his house arrest at his swanky Manhattan apartment, after a judge refused to send him to prison on Monday.
Madoff’s lawyers have pointed out that he has cooperated fully with officials and investigators since allegedly confessing his $50 billion Ponzi-scheme to his sons last month.
“Aside from the bare assertion that there remains some risk of flight, the government has failed to articulate any flaw in the current conditions of release,” said Judge Ronald Ellis of U.S. District Court in Manhattan, speaking of the government’s original push to incarcerate Madoff.
Prosecutors have tried to convince the court that Madoff is a flight risk after forging alliances with individuals all across the globe. They also said he violated a court order that froze his assets after he dispersed more than $1 million worth of valuables via mail to friends and family.
Right now, Madoff is under 24 hour surveillance at his Manhattan home. His incoming and outgoing mail is also under investigation and he must provide a list to the U.S. government that outlines his portable valuables.
If convicted, Madoff faces up to 20 years in prison in what has proved to be the largest Wall Street scam in history. Dozens of wealthy individuals, banks, hedge funds and financial institutions have lost billions in investments tied to Madoff.
Julie Scuderi Senior Editor for HedgeCo.Net Email: julie@hedgeco.net
Bloomberg – The U.S. Securities and Exchange Commission opened a new investigation into whether Pequot Capital Management Inc., the hedge fund run by Arthur Samberg, illegally profited in 2001 by tapping inside information on Microsoft Corp., two people familiar with the matter said.
Investigators learned of documents that show former Microsoft employee David Zilkha may have obtained confidential information about the software maker, said one of the people, declining to be identified because the investigation isn’t public. Zilkha left the company in 2001 to join Pequot.
MSN Money UK – Bernard L. Madoff Investment Securities LLC was examined at least eight times in 16 years by the U.S. Securities and Exchange Commission (SEC) and other regulators, who often came armed with suspicions, the Wall Street Journal said.
SEC officials followed up on emails from a New York hedge fund that described Bernard Madoff’s business practices as "highly unusual," the paper said.
The Financial Industry Regulatory Authority, the industry-run watchdog for brokerage firms, reported in 2007 that parts of the firm appeared to have no customers, according to the paper.
Madoff was interviewed at least twice by the SEC, the paper said, adding that regulators never came close to uncovering the alleged $50 billion Ponzi scheme that investigators now believe began in the 1970s.
Munster Times – Investigators may get a clue Wednesday into how much money might be available for victims in the Bernard Madoff scandal.
The fallen investment guru is scheduled to submit a list of his personal assets to the Securities and Exchange Commission by the end of the year, including property that could be tapped to make restitution to victims of what authorities say was a $50 billion Ponzi scheme.
In a previous court hearing, Madoff also agreed to provide the names and locations of entities, bank accounts, brokerage accounts, investments or assets held by his business, Bernard L. Madoff Investment Securities LLC.
