Madoff Plea

Fascinating reading, in my humble opinion, and it supports the position taken in my previous posting about Madoff’s investment advisory firm being a hedge fund. You can find this attachment on line at http://www.usdoj.gov/usao/nys/madoff/madoffhearing031209.pdf, or you can click the pdf on this blog below.

Unreal, and in my opinion evidence that the SEC is not to blame. Bernard Madoff admits to knowingly committing the crimes that have been charged. In my humble opinion, he could not have succeeded, as smart as he was, if he had not been functioning as a hedge fund advisor. Any state or SEC audit of a Registered Investment Advisor would have found the discrepancies in his accounting. They couldn’t audit him because he was exempt from registration. The hedge fund advisor was registered in February of 2006, but the US District Court of Appeals struck down the registration requirement in June of 2006. The SEC no longer had the ability to simply waltz in and audit. They needed more than Markopolous. Still wondering why they aren’t publically saying that, but…

Call your congressman and demand that Hedge Fund Advisors be subject to the same regulations as other advisors. Congress needs to amend the Investment Advisors Act of 1940 to make it law.

US Department of Justice, Transcript, Madoff Plea on 3.12.2009

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