But consider the question of accomplices. If someone robs a bank and the security guards simply look the other way, do those guards qualify as accomplices? Furthermore, if those bank robbers did not have to worry about any alarm system because they had cohorts who disabled the alarm system, do those cohorts qualify as accomplices?
Madoff's relatives were undoubtedly in the scheme and should be in the dock with him. But that dock is missing some key defendants. Among the missing are former chairman of the SEC Christopher Cox and key staff members of the SEC in Boston and New York.
Harry Markopolos, who formerly worked for a hedge fund rival of Madoff's, gave testimony to Congress in the Madoff case just a few weeks ago in which he described in detail his repeated and futile attempts over a period of nine years to get the SEC in both Boston and New York to investigate Madoff and charge him with running a Ponzi scheme. The Wall Street Journal described and documented this process, which has now been pushed into oblivion. Markopolos told the Congress that it took him about five minutes to look at the returns that Madoff was paying and compare them to the stock market to conclude that a massive fraud was underway.
When the SEC finally did investigate Madoff in 2006, based on a submission by Markopolos of a document entitled "World's Largest Hedge Fund Is a Fraud," Madoff was let off with a few charges of technical violations and went on to continue his scheme.
In addition to the SEC, a principal defendant should be Alan Greenspan, former head of the Federal Reserve Board who used his power and influence to shield hedge funds from regulation. In 2004 he opposed even registration of hedge fund managers before the Senate committee, telling the committee that as long "as hedge funds remained the province of wealthy and institutional investors, additional oversight would not be needed."
To this group should be added the heads of the Treasury Department, the Senate and House banking committees, which refused to use their powers to intervene in the "casino" economy that developed at a dizzying pace in the last decade.
The SEC would not investigate. The Federal Reserve Board would not allow regulation. The Congress would not intervene. As protectors of the rich in general, these institutions made it possible for Madoff to carry out his $50 billion Ponzi scheme. He was able to operate under the regulatory radar because the leaders at the summit of finance capital deliberately put in place an apparatus whose job it is not to investigate, not to uncover, not to interfere with get-rich-quick speculation and gambling.
This arch criminal overstepped all boundaries and cheated his fellow millionaires and billionaires. He also ruined many ordinary workers in the institutions that went out of business once the scheme fell apart. But he was enabled at every step of the way by the SEC and all the other so-called "oversight" institutions of finance capital.
The capitalist media could dig all this up if they wanted to. But they are intent on keeping the spotlight on one individual criminal so that it won't fall on the much larger and truly powerful enterprise of the SEC-Fed-Treasury complex. These institutions have long protected the "legitimate" swindlers that deal collectively in the tens and hundreds of trillions of dollars. They are in collusion with the hedge funds, the private equity firms, the investment banks, the commercial banks, the mortgage industry, the credit card industry, and all the other loan sharks who have been allowed to operate with impunity as they bilked millions of workers with subprime mortgage fraud, usurious credit card interest, astronomical student loans, and other schemes.
This is the logic of the capitalist profit system. This is not a failure of the system. It is the system.
Labels: banks, capitalist, Greenspan, hedge funds, Madoff, Markopolos, Ponzi sheme, SEC
