Madoff whistleblower’s Harry Markopolos’s testimony to Congress makes for fascinating reading.
If you can’t make it through the entire 65-page document, here are some select highlights from Section One.
First, on Madoff’s ‘too good to be true’ returns:
On his initial contact with the SEC:
On the European leg of his investigation and the realisation that Madoff was running a Ponzi scheme:
On his second attempt at SEC contact:
On his third attempt, fearing for his safety and the involvement of the Wall Street Journal.
On Madoff’s growing difficulties:
And why Madoff ultimately turned himself in:
On what he did not know.
And finally, his conclusion:
As mentioned earlier, that’s just Part One of Markopolos’ testimony.
The second section concerns his proposed changes for “rebuilding” the SEC, with the current situation is described as “Dire but fixable: There’s no where to go but up!” Recommendations include simple things like logging individual tips and referring the more credible ones to their relevant SEC offices, to raising the qualification bar for SEC employees and the expansion of the organisation’s whistleblower bounty system.
A bit of self-interest there, Markopolos, but well-deserved nonetheless.
Related links:
Written testimony of Harry Markopolos – WSJ