The Wall Street Journal has a deeper look at the various government investigations into Bernard Madoff’s business, stretching back over the last 16 years — all of which failed to detect the alleged “$50 billion ponzi scheme” that Madoff is said to have been running.
Among other nuggets, the Journal reports:
The failure to stop Mr. Madoff also is an embarrassment for Mary Schapiro, the Finra chief who has been nominated by President-elect Barack Obama as the next SEC chairman. Finra [the Financial Industry Regulatory Authority, an industry-run watchdog for brokerage firms] was involved in several investigations of Mr. Madoff’s firm, concluding in 2007 that it violated technical rules and failed to report certain transactions in a timely way.Ms. Schapiro declined to comment. Mr. Cox has previously acknowledged mistakes by the SEC. The agency declined to comment.
Close SEC watchers generally have said they expect that under Schapiro, the agency will be a more vigilant watchdog than it has been under President Bush’s various chairs, culminating with Chris Cox.
Still, Finra’s failure, under Schapiro, to catch Madoff is another reminder that, even though the SEC’s problems were in part a result of the pure free-market ideology to which the Bush administration largely subscribed, those problems likely won’t immediately be solved by the change of administrations.