Home -> Law Blog Directory -> Legal Research Blogs -> New York Supreme Court Criminal Term Library

Legal Research

: New York Supreme Court Criminal Term Library

Wall Street Journal: Madoff Case Displays Deep Flaws in Financial Enforcement

By David Badertscher, PLL

pfont size=2strongSource:/strongemCrime and Justice News, December 18, 2008./em/font/p#13; pfont size=2The lesson of the Bernard Madoff case is that financial enforcement nearly always fails to protect investors, and this Ponzi scheme is merely typical, says the Wall Street Journal in an editorial. Since 2000, the SEC's annual budget has ballooned to more than $900 million from $377 million. Its full-time examination and enforcement staff has increased by more than a third, or nearly 500 people. The percentage of full-time staff devoted to enforcement -- 33.5% -- appears to be a modern record. /font/p#13; pfont size=2Yet they still failed to nail Bernard Madoff-- even after trader Harry Markopolos wrote in letter to the SEC in 1999 that 'Madoff Securities is the world's largest Ponzi Scheme.' The Journal says, 'There's a lesson here for investors and Congress. Instead of shoveling more money and power to the regulators who already had plenty of both, let's take care not to overregulate the people who actually warned about Mr. Madoff's miracle returns. Law enforcement is useful in punishing wrongdoers after the fact, which will deter some crooks. But expecting the SEC to prevent a determined and crafty con man from separating investors from their money is no more sensible than putting your life savings with a Bernard Madoff.'  /font/p#13; pa href=http://rs6.net/tn.jsp?e=001GcQZbjnagmWJBD6MdHERmFP8ty2fI1QiijUENDvVKoteMDVslGIH9KucWjqNt4ZK02G3NSBN_HRw1b6dQ4EdcTcYwQrwutEUetHLGxe-qBHswt_Wp37NPXJtLtkENow28gCqOECAg8FconZYQ8Nx-Yfd-5WTubwt shape=rect color=#0000FF target=_blankfont size=2Wall Street Journal/font/a/p

Full post as published by New York Supreme Court Criminal Term Library on December 18, 2008 (boomark / email).