Madoff Winners May Have To Give Back Earnings, Too

Fortune:

Should you be penalized if you were smart enough to pull your money out of Bernard Madoff Investment Securities before it imploded in what appears to have been a multibillion-dollar Ponzi scheme? That's only one of the depressing issues facing investors who put their trust in Madoff.

For starters, simply trying to fathom the assets and liabilities of Madoff's firm will be a Herculean challenge. "I don't think the extent of the losses is going to be known for months," says Stephen Harbeck, CEO of the Securities Investor Protection Corporation. "This is a completely different order of magnitude than anything that has gone before it, certainly in terms of brokerage firm failures or any other kind of financial institution fraud. This is a monster."

Read the whole story: Fortune

Comments

[mincepies]

$50 billion - FIFTY BILLION DOLLARS!! Blown!

It is beyond mind blowing that this could happen at all and the fact that he was operating for many years without hindrance is even more shocking.

This begs questions about all other private equity/hedge funds operating with almost zero oversight? Given the levels of corruption, its very likely there are more Madoffs around.

Since the crisis started the government has been staving off economic collapse by pumping cash into the system. There has been no effort to restore CONFIDENCE, and because of this lack of CONFIDENCE everything continues to decline. It is critical to take severe action:

1) Anyone considered possibly culpable in any of the constituent parts of this crisis should be off to jail to await formal prosecution and trial. Madoff has ripped off the equivalent of several times the budget of California, affecting millions in the process. He should be in jail awaiting trial, not sitting comfortably at home.

2) Per Sarbanes, leadership should pass an emergency law compelling officers/ directors of any investment businesses in the country to formally attest that this is not happening in their businesses. Failure to comply or subsequently revealed untruths should carry extraordinarily heavy mandatory penalties - huge fines, long prison terms without parole, limited appeal.

The people who'd do this stuff have to realise that there are real and very severe consequences for their actions.

We have to restore investor CONFIDENCE in the system - new regulation won't achieve that on its

[Barryyes]

In all fairness, you can't do "claw-backs" while ignoring the vast amount of money that must have been transferred offshore. Nothing has been reported about the Bermuda comptroller, but if you follow the cash and get it all back, then you can distribute fairly. The SEC ought to be hard-pressed to prove that they can function in this recovery, since they fell down so badly on the enforcement.

[darkhorse12]

the below audio explains Madoffs thigns a bit clearer

http://www.inewsit.com/music/gallery/The-psychology-behind-Madoff-s-fraud

[carolsstudio]

The Web has been deluged with the brayings of bigots about "the greed and corruption of the Jews," the Anti-Defamation League reported Friday.

"Jews are always a convenient scapegoat in times of crisis, but the Madoff scandal and the fact that so many of the defrauded investors are Jewish has created a perfect storm for the anti-Semites," said the league's Abe Foxman.

"Nowadays, the first place Jew-haters will go is to the Internet."

As reported in NY Daily News.

[Mogamboguru]

Who is exposing himself, should't complain,when he is being called out for it, afterwards.

BTW: Do you notice, that YOU are pointing to the jews with your contribution, actually? I don't. But whom the shoe fits, shall wear it.

What is this p.a.s.s.i.v.e./.a.g.g.r.e.s.s.i.v.e. posting good for? I want to understand the reason, why you posted what you posted.

[carolsstudio]

p.a.s.s.i.v.e./.a.g.g.r.e.s.s.i.v.e.

Maybe, but almost all of the victims are Jewish, Madoff is Jewish and yet it has given rise to
anti-Semites. I found it strange that this act is being used by anti-Semites to further their cause. I also found it strange that Madoff seemed to prey on people of his own faith/community for victims. I find that particularly ruthless.

What is my posting good for? Dialogue. What do you think.

[3dtrix]

And gamblers, and political junkies, and sports fans, and porn-lovers, and recipe-hunters, and...

The point is? People of dubious character use the web? Make it viral!

[bby328]

Well, in that case - Free Bernie.

[gevan]

Next thing you know, damn yankees will have to give restitution for allowing slavery to exist for so long in Dixie.