“U.S. District Court Judge Jed Rakoff smelled something fishy in the August 3rd deal the SEC cooked up with Bank of America…….
That was the same view held by the Congressional questioners in the Madoff matter at the February 4, 2009 dust up with top SEC officials. After many rounds of pointed questions produced unresponsive answers, round tripper Andrew Vollmer, then Acting General Counsel of the SEC, explained why. He and his fellow SEC panelists were claiming executive privilege. This position elicited the following outburst from Congressman Ackerman: “Your value to us is useless…Our economy is in crisis, Mr. Vollmer. We thought the enemy was Mr. Madoff. I think it’s you…you were the shield…You come here and fumble through make believe answers that you concoct and attribute it to executive privilege….”
On April 2, 2009, another of Wall Street’s favorite law firms, WilmerHale, announced that Andrew Vollmer would be returning to the firm as a partner. According to the press release, before joining the SEC, Vollmer was a vice-chair of WilmerHale’s Securities Department…….
…And just what does the Madoff fraud have to do with the big firms on Wall Street? The multi billion dollar proceeds of the fraud were wired in and out of JPMorgan Chase where Madoff maintained his firm’s account. Also, Madoff partnered with Citigroup’s Smith Barney, Morgan Stanley, Merrill Lynch and Goldman Sachs to compete head on with the New York Stock Exchange in a venture called Primex Trading as reported here at CounterPunch on January 15, 2009.
Tag Archives: madoff
Is Madoff’s Ethnicity Relevant?
Dr. Phyllis Chesler comments on the Madoff fraud,at Pajamas Media (originally published at Jewcy).
“Yes, of course, Madoff’s betrayal is unforgivable. He has gutted an entire generation of Jewish philanthropic wealth, destroyed trust within the Jewish philanthropic world but, far more important, impoverished widows, orphans, and the elderly and, in so doing, endangered and shamed the Jewish people at a time when we have many real, not merely neurotically imagined enemies.……..
In the Middle East, graft and nepotism make the wheels turn. Everyone is on the take. Beggars aren’t beggars, entire civil services are staffed by one or two clans. I could tell you a thing or two about corruption in southern Asia today, let’s say in Afghanistan, that would make Heller’s Catch-22 seem like child’s play. Everyone, from the President on down is on the take and opium is a most abundant and attractive cash crop. The Afghan drug lords are addicting, infecting, and murdering entire global populations with their poppies as are those who buy and sell the heroin. No one holds the Afghans accountable. But woe to the Jewish nation that has harbored, abetted, profited from, or has even been fleeced by Madoff, the greedmaster.”
My Comment
This is an interesting commentary from just after the Madoff story broke and it makes some good points.But I think it’s on shaky grounds in one or two other places..
I’m posting it today because I recently posted two pieces that some might see as critical of the Jewish people. Mind you, I don’t. I see criticism of Madoff or of US Israeli policy as simply criticism of a conman and of international criminality.
On the other hand, I also don’t think religion or ethnicity is irrelevant to that criticism, any more than religion or ethnicity was irrelevant to criticism of George Bush (hmmm…did I hear any voices raised to protest the attacks on fundamentalist Christianity, whites, Anglos, Wasps? No, I think not).
And is there any let up whatever in the criticism of Islam (Islamofascists), Muslim extremism, jihadis, violent Middle Easterners, etc. etc? None whatever. Doesn’t the color black get dragged into discussion of crime in the ghetto? Didn’t the phrase “Hindu extremism” pop up in discussions about Godhra?
It seems pretty natural to me that people would point out the religion or ethnicity of conmen, especially when the con men are relying on both to play their con game.
Madoff Feeder Funds Sued for Complicity in Fraud
After having said I won’t touch the Madoff story until my site gets a bit more protection, I
couldn’t resist this latest confirmation of something I said way back in December – that the feeder funds probably knew perfectly well what was going on and that “philanthropy” in many instances was just a cover for criminal activity or for misuse of funds. Note the similarity to the scandals at Fannie and Acorn, where the mandate to help poorer people get housing loans also provided moral cover for crime.
One critic correctly points out that Madoff targeted charities, precisely because their pay out every year was only 5% of their capital. This was ideal for a Ponzi scheme, since it allowed Madoff to give out very little of what he took in each year.
“the American Jewish Congress which “defends Jewish interests at home and abroad through public policy advocacy using diplomacy, legislation and the courts.” It reported about 24 million dollars in assets, but only spends about 3 million dollars per year. At that rate, it could have continued its work through 2017 without further fundraising or investment income. Instead they invested their money with Bernie Madoff, losing 87% of the endowment!” [Who Made Off With Our Tzedakkah? Time to blame the victims,” Daniel E. Loeb]
I told you back then that people who’d made out like bandits would be suing as though they were victims. How did I know that? Well – I taught high school. There’s nothing about human nature, good and bad, you don’t see there..
I know how well-heeled non-profits operate. Half the time, money meant to benefit children never gets to them. It ends up in the pockets of administrators, lawyers, and various salesmen and middlemen.
The whole educational/research establishment is rife with fraud of all kinds. Some of it is unintentional fraud – where the money gets to the intended recipient, although the activity of the recipient (the research or whatever else) is pretty much a dead-end or a waste. But in other cases, the fraud is intentional, as below.
Here’s the latest from Fox News:
“Also among those sued Tuesday is one of the leading educational philanthropies in the United States, which claims it was wiped out by Madoff’s far-reaching fraud.
The complaint filed Tuesday alleges the Picower Foundation and several related entities made nearly $7 billion by investing with Madoff. At least $5.1 billion of that came out of the pockets of victims of a giant Ponzi scheme, and should be returned, it [the complaint by court-appointed trustee Irving Picard] said.”
And more:
“The Palm Beach, Fla.-based foundation had given millions to the Massachusetts Institute of Technology, Human Rights First and the New York Public Library. It also funded diabetes research at Harvard Medical School.
The trustee’s Picower complaint says Madoff managed accounts that earned astronomical returns over 13 years. One purported to earn 950 percent in 1999.”
My Comment
Very different from the spin we first heard, right? Remember they were telling us back in January that the funds returned very average earnings and no one could be expected to have seen through the scheme? Turns out that that wasn’t quite the way it was. Nearly thousand percent returns? How hard is that to question?
This also confirms what I said in “Nationalization in a Time of Monopoly,” as well as in a later piece “Nightmare on Wall Street”: A lot of the fraud was committed at the height of the bubble economy and involved a number of players. [Note: Obviously, Picard’s allegations are just that at the moment. We will have to wait and see how the suit plays out to get a better idea and hear more of the evidence on either side].
Far-fetched conspiracy theory?
Not at all. There are only a limited set of powerful actors at the highest levels of Wall Street. Bernie Madoff wasn’t a sidekick. He played at the top. The people at the top knew him (I mean, SEC honchos, leading bankers and money managers, government bigwigs). He didn’t do all this without a wink and a nod.
Which means there’s more going on here than meets even Picard’s eye. But until I get my site better protected, I’m not planning on digging any more…
Meanwhile, on the Madoff connection to the mob, there’s an interesting post at Deep Capture blog, which has this:
“After Milken was indicted, Black rallied to Milken’s defense. It was Black [Leon Black], more than anyone, who prevented Drexel from firing Milken. And Black has remained obstinately loyal to the criminal Milken ever since. After Milken went to prison, Black founded the Apollo Group, an investment partnership that received most of its initial funding from a French aristocrat named Rene Thierry Magon de La Villehuchet.
Among Black’s first moves as an independent “prominent investor” was to launch a takeover bid for Executive Life, a bankrupt insurance and financial services conglomerate…….Later, though, it emerged that Black’s takeover of Executive Life had been illegal because he had secretly been fronting for certain French investors, including Monsieur Rene Thierry de La Villehuchet. Some of the French investors had illegally parked stock with Black to hide their involvement (“parking stock” being one of the favorite techniques of the Milken-Boesky-Thorp crew, and a recurrent theme in the 98-count indictment that sent Milken to jail).”
The French aristocrat, Rene Thierry de la Villehuchet, was the manager of one of the Madoff feeder funds. He killed himself earlier this year, reportedly from a sense of honor toward his clients whose money was lost in the scam. But if the account at DeepCapture is to be believed, he seems to have been involved in rather shady deals even before getting together with Madoff.