Tipster warned SEC of Madoff in 2000

By Juan Carlos Fanjul email
Posted by Rachel Leigh email

WASHINTON, DC (WFLX) - "The SEC [U.S. Security and Exchange Commission] continues to roar like a mouse and bite like a flea," said Independent fraud investigator Harry Markopolos

On Wednesday, the spotlight fell on Markopolos who tried to warn regulators about the Bernie Madoff scheme.

And that tipster says, what took him just minutes to figure out, the government never figured out until it was too late. "I'm suggesting that if you flew the entire SEC staff to Boston, sat them in Fenway park for an afternoon, that they would not be able to find first base."

As direct as an attacks gets: Independent fraud investigator Harry Markopolos testifying in D.C. Wednesday and laying the blame on the SEC for allowing the part-time Palm Beacher Bernie Madoff's wheeling and dealing to get out of control.

"My team and I tried our best to get the SEC to investigate and shut down the Madoff deals with repeated and credible warnings to the SEC that started in May 2000 when the Madoff Ponzi Scheme was a $3 - $7 billion fraud."

And, now, the Securities and Exchange Commission says it's a $50 billion scheme. But Markopolos told the congressional panel that the crime could have ballooned into a $100 billion fraud if Madoff, who is still under house arrest in New York, hadn't confessed.

Markopolos pointing out it took him only five minutes to see something was wrong. "The SEC is over-lawyered and has few too staff with relevant industry experience and professional credentials to find fraud even when a multi-billion dollar case is handed to them on a silver platter."

A trustee liquidating Bernard Madoff's investment firm has told a federal judge that nearly $950 million in cash and securities has been recovered for investors. Only a drop in the bucket.