Mystery? SEC Not Effective at Stopping Fraud
December 16, 2008 by FCD Administrator
Filed under Current, Guest Articles, Money & Economics, Principle 12
By Stephen Labaton (International Herald Tribune) | WASHINGTON: The U.S. Securities and Exchange Commission, a once-proud agency with an impressive history as the top cop on Wall Street, finds itself increasingly conducting autopsies of leading financial institutions after failing, in the first instance, to perform adequate biopsies.
The latest black eye for the commission came when it was disclosed that inspectors and agency lawyers had missed a series of warning signs at Bernard L. Madoff Investment Securities. If it had checked out the warnings, the commission might well have discovered years ago that the firm was concealing its losses by using billions of dollars from some investors to pay others. The firm was the subject of several inquiries over the years, including one last year that was closed by the agency’s New York office after it had received a referral of potentially significant problems from the Boston office. Similarly, the SEC chairman, Christopher Cox, assured investors nine months ago that all was well…<<<Read the Full Story>>>.
Why am I not surprised? Because the SEC is about preventing people from making mistakes instead of punishing fraud.
The whole Madoff scheme is an intricate web of people who turned a blind eye. I believe their were some people who honestly did not know, but their were some willing participates. One question, will justice be handed to Madoff, the same way, people on a much smaller scale are being handed ridicule time in the mortgage industry?