Obama: Madoff Behind Bars

President Obama... I have to ask, why isn't Bernie Madoff behind bars?

I hate to admit it, but I've got this sinking feeling that the Obama Administration doesn't understand the optics of how the market looks to average Americans.

It starts with Bernie Madoff. He's a criminal. He's a fraudster. He's a con-man. His sons have as much as said so. But despite a $50 billion dollar fraud, he's living in his lovely NY Apartment -- under what has been called ""a kind of gilded penthouse incarceration."

The Fed's didn't have to let that happen. But, despite the idea that this isn't going to be an era of politics as usual, there's been not a single person put in prison from the shocking array of con men and fraudsters that have been exposed in recent weeks.

Meanwhile, Obama's housing bailout has the media talking about holding "irresponsible" homeowners responsible for taking on loans they couldn't afford. Let me get this straight, average Americans went to get a mortgage, filed papers with their income and assets, and were give sub-prime loans that ballooned and left them unable to pay their bills.

Explain to me how working class folks were supposed to know that they couldn't afford the mortgages that the banks approved them for. Isn't that the whole purpose of the mortgage review process?

So, lets re-cap. Madoff. Crook. Keeps his house, ok, he's got security guards, but guess who's paying for them, and for the monthly mortgage on the apartment, well, the folks he stole from are paying to keep him comfortable. That's just wrong.

Meanwhile, the folks who strove to become homeowners, only to find that mortgage companies sold them loans that exploded in their hands, and forced them in to default, well they're now out on the street.

There's lots of hand wringing about why the market is doing so badly. Yet Madoff, R. Allen Stanford, Marcus Schrenker and a long list of other equally scammy fraudsters who've manipulated the market are all being treated as white-collar criminals. Wall Street is a marketplace that requires investors to trust that there is fundamental honesty in the way everyone participates. Treating the largest criminals and con men better than a guy who robs the corner newspaper stand reminds people trying to keep their homes that the game is rigged.

Until the Federal Government comes down on all of them with a hammer, puts them behind bars, seizes their assets, and looks to make investors whole, the average investor isn't going to be able to tell the difference between the legitimate market and the increasingly large number of stock scammers who've created Ponzi schemes and ruined the lives of mom-and-pop investors whose life savings are now wiped out.

Madoff isn't a little story.

His smarmy grinning face, clearly remorseless and unbothered by the financial fire-storm he's unleashed. It seems like little more than the tip of the iceberg. He ends up representing Lehman Brothers Chief Executive Richard Fuld, who sold his $14mil house to his wife for $100 to avoid potential judgments.

The Justice Department should act. Swiftly -- and visibly -- to jail and prosecute those that have undermined our national faith in the stock market with bare-naked greed and criminal enterprises. In the case of Madoff, there is little doubt that many individuals knew that $50 billion dollars worth of stock transactions never took place. The prosecution should reach far and wide. The Justice department should take a hard look at the SEC, which based on its far too chummy relationship with Madoff and his family seemed to turn a blind eye to legitimate concerns raised about the Madoff organization. The fact that Madoff essentially was brought down by the market, not any investigation is deeply troubling on its face. Had the market not turned, the Madoff scam would have continued unabated.

Restoring faith in the market will require holding criminals who've undermined the market responsible. Anything less will leave average American's faith shaken, and the markets without the participation of the retail investor.

Barack, ask the Justice Department to get busy here. In order to restore faith in the financial system, there needs to be some accountability and penalty for those that break the law. Slow motion justice sends the wrong message in the Madoff case.

Comments

[BCubedReg]

Mr. Rosenbaum, I wholely agree with you that Madoff should be sitting in jail until his trial giving him the rest of his life behind bars for his financial ccrimes he commited. But your blame centered on the President is misplaced. They judge that has twice now allowed Madoff to sit and remain on house arrest vice in a prison cell is to blame.

I would look into the judge's financial records to see if he is on the Madoff payroll.

[fredjernig]

As much as a mystery of how he pulled it off so far is what is going on now:
- why does Madoff appear so cool? Is he not at risk for severe depression?
- why is he not a flight risk? Too recognizable? Give me a break.
- who are the (inevitable) accomplices, and how much money is safe somewhere?
- he probably has greatly irritated quite a few very rich, very corrupt, very powerful, quite remorseless investors: isn't there a risk for his life? Is his security that good? Are his windows bulletproof, because that photo certainly could have been taken by a sharpshooter. I certainly would stay away from windows.

[teacheng]

Hey man, I want this Madoff character behind bars, too. But this is the justice system's call, not Obama.

He is not a universal fixer. We have a balanced system of government. Call out the judge who decided this instead!

[The Western Clock]

everyone is Innocent until proven guilty.
and when we want everything we loose all things.

[Catothemuchyounger]

Uh, Madoff has not been convicted of anything yet. Unless the Court finds him to be a flight risk, he is not supposed to be in jail. This is not complicated: we generally jail people AFTER they are convicted of crimes, not before.

Innocent until proven guilty, that kind of thing.

[batguano]

Many would like to see this "super-thief" experience the same criminal "justice" system that most of us experience, but as many have pointed out this is not Obama's job, it is the courts, and the Justice Dept did try to get his bail revoked, but judges said no. The super-rich do enjoy advantages that many citizens can not expect from our criminal justice system however, and it would be cathartic to see this s-bag receive the same treatment that a person who steals a loaf of bread or smoke a joint does! This does not on the face of it seem to be "fair" that he enjoys freedom while most who may not be able to afford bail (and are not "risks") do not. There is another aspect, and that is the repair of and faith in our institutions ? and the belief, and reality,that there is accountability, not only golden parachutes and stock options in addition to millions or billions in salary for incompetent, destructive, criminal or failed leadership. No one should be above the law, but many are, and they are the rich who lead lives of obscene luxury while most people cough out their lives struggling for every penny, wage-slaves every one.

[feyangel]

Hello-- what makes you think it is Obama's job to put Madoff behind bars??? That is the LEGAL SYSTEM'S JOB!!

[Steve Rosenbaum - Huffpost Blogger]

Clearly the President doesn't have any control over local Courts. However, in his attempts to right both the banking system and calm the markets - he needs to be aware of what Wall Street looks like from the living room's of mainstream America. He could easily convene an investigation into the actions of the SEC - and put in place stronger safeguards for individual investors who count on the SEC to regulate (and investigate!) the Madoff's of the world. Short of this - the fear that the market is in fact on great big Ponzi scheme will undermine any retail recovery.

[larry278]

Perhaps Pres Obama could ask the SEC to make inquiries about Mr Madoff's acts but he prefers to let the Dept of Justice handle Mr Madoff's case. That is a custom, tradition &, I think, the US Constitution & other US laws now in force give AG Holder jurisdictiction & a clear cut standing in the matter of Mr Madoff's actions. It's almost certain that a US Court will hear a case brought against Mr Madoff by a US Grand jury. If a US Prosecuting Attorney is successful, Mr Madoff will be found guilty. The US Court may, then, sentence Mr Madoff to time in prison. As you mention, a state(s) court(s) could be involved in examining Mr Madoff's acts. That complicates things.
Since Pres Obama is a member of the bar & taught constitutional law at a 1st tier law school, he knows of double jeapordy(sp?). His AG knows of double jeapordy(sp?). I have 25 cents that says that an Obama administration will avoid allowing even a hint of trying to use double jeapordy(sp?) to harass Mr Madoff.
We must wait for the proper court to decide Mr Madoff's fate.
Changes in federal laws & regulations may not be used in judging Mr Madoff's past acts. Obama & Holder will have no rush to judgment of Mr Madoff. Mr Madoff will have his days in court 1st.

[gioia2009]

Steve, the SEC Inspector General launched an investigation into how the SEC handled the Madoff affair two months ago. So you're faulting Obama for not doing what is already being done.
http://www.cnbc.com/id/28253164

[Jimmyboyo]

Madoff not behind bars = NY legal system

though prosecutors tried twice to not have him out on bail

I will give madoff credit though that he at least has hidden "a flight risk" ( STANFORD not so much)

I suspect though that a judge or judges have either recieved a nice fat envelope or expect by allowing him to be in his penthouse on bail that they will in the future recieve a big fat envelope.

By all means AG Holder should be looking into the situation but he has to be careful about stepping all over local judges

[royevatom]

After a lengthy trail or short capitulation with reduced sentence, Mr. Madoff will probably end up in a prison that allows him to live pretty much as he is living now except the space will be reduced and his movements more restricted. Put him in with the general population at one of the nations notorious prisons and justice will seek it's own equilibrium. But that won't happen because Mr. Madoff will need his laundered white shirts. In a few years he will be released due to his age and his health to return to his family who will still be enjoying the income from their investments. Welcome to the United States of America and Modern Day Times. Neither the President nor the people who lost there funds will do anything about this. This is how it works when you have money, privilege and entitlement; yet this is the way we have decided it should be. We not the courts or the President or Congress or the Justice Department or anyone else.

[tlgeiger62]

It sure would be a morale booster to MANY if these guys were hauled out of their homes (preferrably on a dark and rainy night) in their pajamas (sans robe) and hauled off to prison.

[sarale23]

Dear Mr. Rosenbaum, while I share your outrage at Madoff's residence status, I believe your questions are clearly misaddressed. As you may have heard, there's a separation of powers in the USA. The President is the head of the executive branch. His job, and only job, is to defend the Constitution. He does not deal with Madoffs, Stanfords, and vice versa. You should address your questions to representatives of the judiciary branch aka judges. Most of them work in courtrooms. Please do not hesitate to contact m if you have any further questions. Stay well.

[FightingTheRight]

Apparently, Mr Rosenbaum has mistaken President Obama for the judge, who set the terms for Mr. Madoff's release.

[HCnVT]

Write to Congress expressing anger in regards to the SEC's handling of the Madoff Fraud:

Below are instructions in regards to a website that has been developed to generate letters to Congress; the site is user-friendly with sending letters to Congress; how to access ANY Senator & House Representative, including those that only use "webmail". Within the website, you have the option to be listed as a Madoff VICTIM, a RELATIVE of a Madoff Victim or a FRIEND of a Madoff Victim:

1) Go to: http://www.bernard-madoff-fraud-resources.com/
write_to_y­ou_rep_mad­off_fraud.­php
2) You will find a drop-down menu at the above site for your respective State. All Senators and Congressional Representatives' email addresses that have been garnered are listed.
3) If your State’s Congressional reps are listed great; if not or if
for example only 1 Senator or no House Reps are listed then do the
following:
4) COPY the website's letter and then go to the following 2 sites to PASTE:
US SENATE http://www.senate.gov/general/contact_information/senators_cfm.cfm
US HOUSE https://writerep.house.gov/writerep/welcome.shtml
5) each of the above sites will lead you to your respective Senators & Congressional Reps; PASTE the letter into the respective Senator & House Reps "webmail" form; then SEND
6) Note that it's important to only send to Senators and Representative from your state; otherwise the Senator and Rep will view the letter as SPAM

[iamvalid]

HCnVT, you have provided some good information for others to follow up with. I too have shared my frustration with other Americans wondering where this is all going to end. I am more and more fearful as each day goes by. In an interesting note I have indeed emailed my senators and congressmen with mixed results. I ventured a simple one line question.

"Seanator xyz, Why isn't Bernie Madoff in jail?"

I am from Montana and we have two democrat senators and one republican congressman at large. They are senators Max Baucus and Jon Tester, along with congressman Deny Rehberg. I am sure all of them are working hard on this issue.

Senator Baucus did not actually reply any wording directly related to Bernie Madoff, but he assured me his office is working hard with other senators trying to come to some type of a solution.

Senator Tester replied the Bernie Madoff was not in jail because it was felt that since he had enough security watching him, he would not be a flight risk. He also elaborated on what his office was try to do to get the economy moving. It appeared to be an email actually addressed by Jon or his office. I am impressed with senator Tester as he appears to be trying hard to find solutions to our problems.

Our republican representative Deny Rehberg did not bother to answer me at all. He never does anyway. I think it's a republican thing.

[channelerchik]

Obama is not Santa Claus or the Wizard of Oz, and he's got a lot on his plate. Could we not hold him responsible for solving every single problem in the US and world? There are other people in power that have responsibility as well.

[Neville Appanna]

hi:)
I suppose one could ask Pres Obama lots of questions that he'd probably have no real answer to.
You could ask why the economy continues to tank too, but no real answer.

If you ask why people in charge of so called 'communications' on govt's dont do their jobs either, theres no answer for that.

So, it shouldn't really surprise anyone why Madoff is in a penthouse:) Its because if you're in big business, and positions of power, you are above the law in many ways because those in places like the Dept of Justice, and law firms are actually corrupt. How really does the SEC , not see such occurrences? Its not because they didn't see..it's because people in there get paid to be blind. Of course, everything is always very rationalised, and 'legal'...so, thats probably surprising to ordinary people.


http://sites.google.com/site/newenergyworldfirst/

[royevatom]

Everyone knows that crime doesn't pay but corruption on the other hand pays very well.

[Skepticat]

Anatole France once wrote 'The law is just because it prevents both rich and poor from stealing bread."