Might this be the most expensive mea culpa in history? SEC Chairman Christopher Cox has admitted “apparent multiple failures” in his agency’s oversight of Bernard Madoff’s alleged $50 billion Ponzi scheme. According to The Wall Street Journal, the SEC was “aware of numerous red flags raised about Bernard L. Madoff Investment Securities LLC, but failed to take them seriously enough.” Cox said that “credible and specific allegations” were made against Madoff as far back as 1999, but they “were never recommended to the Commission for action.” In 2000, Harry Markopolos, a rival of Madoff’s, wrote the SEC a letter saying “Madoff Securities is the world’s largest Ponzi scheme.” The investigation will include a probe into the marriage between Madoff’s niece and a former official at the agency who supervised oversight of trading at stock exchanges and electronic-trading platforms.
Read it at The Wall Street Journal (subscription required)
