Madoff whistle blower testifies before Congress

CBS:

On Capitol Hill Wednesday, the financial analyst who first blew the whistle on Bernie Madoff back in 2000 went public for the first time, stunning lawmakers with the full scope of the $50 billion fraud. CBS News correspondent Armen Keteyian reports.

In two hours of riveting, no-holds barred testimony, Harry Markopolos revealed the depth - and danger - of his nine-year fight to expose the Madoff scandal.

Markopolos said at one point he feared for his life.

"He would have known my name and, he knew he had a team tracking him. I didn't think I was long for this world," he said.

One reason: Bernie Madoff was among the "most powerful men" on Wall Street.

Another: In 2002 Markopolos said he discovered billions of dollars in "dirty money" was being funneled into Madoff Securities through a series of off-shore accounts.

"When you're that big and that secretive, you're going to attract a lot of organized crime money, and which we ... now know came from the Russian mob and the Latin-American drug cartel," Markopolos said.

Markopolos said he began his crusade back in late 1999, when he was asked by his employer to see if he could match an investment strategy that produced unusually steady returns - like Madoff’s.

"It took me about five minutes to figure out that he was a fraud," Markopolos said.

...
Is this guy saying that Madoff was screwing the Russian mob and South American Drug dealers? I find it hard to believe that Madoff was that crazy. I don't even think Tony Soprano would put up with that kind of scam. Most of Madoff's victims were Jewish organizations and charities and individuals.

Markopolis is to be congratualted for figuring out the scam. It is unfortunate that he could not get the attention of regulators. I suspect if Stanley Sporkin or Wally Timmeny were still running the enforcement division they would have been all over it. The story does not indicate whether he talked to Elliot Spitzer.

Meanwhile the BBC reports that less than two percent of money invested with Madoff has been recovered.

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