Whatever faith I had
in the integrity of Wall Street banks I’ve traded for disillusion.
If you read the above
IHT article by Diana Henriques titled “J.P. Morgan Hid Doubts on Madoff,
Documents Suggest”, you may be frustrated to get confirmation that
although many on Wall Street knew Madoff’s returns were too good to be true, no
one blew the whistle. According to Henriques:
suspicions and many more, the bank allowed Mr. Madoff to move billions of
dollars of investors’ cash in and out of his Chase bank accounts right until
the day of his arrest in December 2008 — although by then, the bank had
withdrawn all but $35 million of the $276 million it had invested in
Madoff-linked hedge funds, according to the litigation.”
Apparently Chase was
more concerned with it’s own business than the welfare of the 720, 000 investors
who were being bilked out of their money by Madoff.
Sound familiar? Before
the Enron scandal came to light it wasn’t uncommon for Arthur Andersen
accountants to question Enron’s financials. However, when doubts were raised,
Enron threatened to no longer contract Andersen as an Enron consultant. From
what I understand, consulting services were worth far more to Andersen than
what it made from auditing, so Andersen complied. Again, more investors got
What I want to know is
what took Sarbanes Oxley so long to be passed, and what provisions still need
to be made to hold Wall Street accountable.