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From Prison, Madoff Says Banks ‘Had to Know’ of Fraud
New York Times ^ | 02/16/2011 | DIANA B. HENRIQUES

Posted on 02/16/2011 6:24:51 AM PST by safetysign

Bernard L. Madoff said he never thought the collapse of his Ponzi scheme would cause the sort of destruction that has befallen his family.

In his first interview for publication since his arrest in December 2008, Mr. Madoff — looking noticeably thinner and rumpled in khaki prison garb — maintained that family members knew nothing about his crimes.

But during a private two-hour interview in a visitor room here on Tuesday, and in earlier e-mail exchanges, he asserted that unidentified banks and hedge funds were somehow “complicit” in his elaborate fraud, an about-face from earlier claims that he was the only person involved.

(Excerpt) Read more at nytimes.com ...


TOPICS: Business/Economy; Crime/Corruption; News/Current Events
KEYWORDS: banking; bankone; banks; bernardmadoff; berniemadoff; chasemanhattan; chemicalbank; classaction; deeppockets; dimon; funds; hadtoknow; hanover; jamiedimon; jpmorgan; jpmorganchase; lawsuit; madoff; morganchase; ponzi; tort
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1 posted on 02/16/2011 6:24:55 AM PST by safetysign
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To: safetysign
Madoff: More honorable than most politicians.

And giving a far better bang for the buck, apparently.

2 posted on 02/16/2011 6:29:02 AM PST by the invisib1e hand (talk to the hand)
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To: safetysign

What constitutes ‘knowing’?

If you mean having sufficient evidence to convict Mr. Madoff in a court of law, nobody had that until he confessed.


3 posted on 02/16/2011 6:31:40 AM PST by proxy_user
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To: proxy_user

He will have a heart attack soon.


4 posted on 02/16/2011 6:37:35 AM PST by scooby321
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To: safetysign

I still do not get why Madoff is in prison. There are rapists, armed robbers, murderers and other real criminals who will do less time than he did.


5 posted on 02/16/2011 6:39:27 AM PST by pnh102 (Regarding liberalism, always attribute to malice what you think can be explained by stupidity. - Me)
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To: safetysign

Then again, he could be lying about this in order to get some love from the MSM, because we know they love ANYBODY who will bash the “evil” bankers.


6 posted on 02/16/2011 6:42:30 AM PST by Ronald_Magnus
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To: proxy_user

The law is pretty clear on “structuring” and transfers to offshore accounts. A banker doesn’t have to know *why* you’re structuring your transactions a certain way, all they have to do is report the activity. The activity could be completely legit, but the federal law still requires a report be made.

It would appear that the banks pretty much looked the other way... because one side of the bank was earning fat fees from Bernie, so the other parts did his bidding.

The bankers have now opened themselves to civil lawsuits (ordinarily I’d also add “and criminal charges,” but we all know that the bankers will walk away scot-free), and therefore they have failed in their fiduciary duty to their depositors and investors.


7 posted on 02/16/2011 6:43:56 AM PST by NVDave
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To: NVDave

The laws you mention require banks to file CONFIDENTIAL reports. Therefore, for all we know some banks may have actually filed them, and the government ignored them.


8 posted on 02/16/2011 6:49:02 AM PST by proxy_user
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To: CutePuppy; ken5050; Condor51; Grampa Dave; sickoflibs; Libloather; DeaconBenjamin; markomalley; ...
Madoff's e-mail asserted that "unidentified banks" were somehow “complicit” in his elaborate fraud.................

Remember when Goldman Sachs had a Friend in the WH named Rahm Emanuel? J.P. Morgan now has a friend in the WH by the name of Chicago Bill Daley.

Ohaha's new COS is Bill "Let's Count the Ballots Again in this Locked Room" Daley. Daley headed the Chicago Branch of The Daley Family Vote Mfg Division which was hired for the infamous Florida recount. The Daley family motto is "When We Fix Elections, They Stay Fixed."

NOTE During the 2008 Democratic presidential primaries, Daley was a prominent supporter of Barack Obama. On November 5, 2008, Daley was named to the advisory board of the Obama-Biden Transition Project.

====================================

MORE DALEY TIDBITS: Bill Daley (brother of Chi/Mayor Richard Daley), is former Commerce Secy under Clinton and long-time executive at Wall Street’s JP Morgan Chase.

REFERENCE Lehman's Bankruptcy Estate Sues J.P. Morgan
WSJ | 5/26/2010 | BY MIKE SPECTOR And SUSANNE CRAIG
FR Posted May 26, 2010 by markomalley

Lehman's Bankruptcy Estate Sues JP Morgan Chase & Co., alleging that JP Morgan illegally siphoned billions of dollars from Lehman in the days before the investment bank filed the largest bankruptcy in US history.

The lawsuit, filed Wednesday in US Bankruptcy Court, New York, alleges that JP Morgan Chief Executive James Dimon and other top executives used inside knowledge to take advantage of Lehman as its financial state worsened.

JP Morgan coerced Lehman to turn over $8.6 billion in collateral in Sept 2008, triggering a liquidity squeeze that contributed to Lehman's collapse, the suit said. The estate is hoping to recoup billions in collateral the bank demanded, and other damages. (Excerpt) Read more at online.wsj.com ...

=============================================

Daley became associated with Amalgamated Bank of Chicago, where he was first vice chairman (1989–1990) and then president and chief operating officer (1990-1993). Daley returned to the practice of law, as a partner with the firm Mayer Brown (then Mayer, Brown & Platt) from 1993 to 1997, where he served on the board of Fannie Mae.

In December 2001, he was appointed President of SBC Communications Inc. to help reform the company's image.

In May 2004, Daley was made Midwest Chairman of J.P. Morgan Chase and Bank One Corp. to oversee post-merger operations from Chicago. (See JB Morgan billion dollar looting reference above--circa 2008.)

Daley currently serves on the Boards of Directors of Boeing, Merck & Co., Boston Properties, Inc., and Loyola University Chicago. He is also a trustee of Northwestern University and sits on the Council on Foreign Relations.

In 1993, he served as special counsel to the President on issues relating to the passage of the North American Free Trade Agreement (NAFTA). In 1997, Daley became Secretary of Commerce in the second administration of President Bill Clinton, and he remained at that post until July 2000, when he resigned to campaign for the Vice President.

After he resigned as Commerce Secretary he became chairman of Vice President Al Gore's presidential campaign. He was portrayed in the HBO film Recount, about the Florida election recount of the 2000 presidential election, by actor Mitch Pileggi.

====================================

REFERENCE Madoff Trustee Says A High-Level JPM Exec Was Warned About Madoff Well In Advance
Feb 3, 2011 | The Business Insider | Katya Wachtel
FR Posted by FromLori

A high-level JPMorgan risk officer was warned that Bernie Madoff had “a well-known cloud” over his head and was suspected of running a Ponzi scheme nearly 18 months before he was charged, according to the FT. The lawsuit in which it's alleged that the executive was forewarned was filed against JPMorgan by Irving Picard, the trustee responsible trying to recover as many funds as possible for Madoff. It has just been unsealed, and was filed secretly at JPMorgan’s request. The suit aims at recovering $1 billion in fees and profits that JPMorgan earned as the primary banker to Madoff’s firm and by structuring Madoff-related derivatives. Picard also wants more than $5 billion in damages. (Excerpt) Read more at businessinsider.com ...

9 posted on 02/16/2011 6:57:39 AM PST by Liz
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To: stephenjohnbanker

ping


10 posted on 02/16/2011 7:08:28 AM PST by Liz
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To: safetysign

Like the bank robber who says it’s the banks fault he robbed it because it had money.


11 posted on 02/16/2011 7:41:17 AM PST by ReverendJames (Only A Painter Or A Liberal Can Change Black To White)
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To: ReverendJames
Like the bank robber who says it’s the banks fault he robbed it because it had money.

Yeah, it's exactly like that, except in cases like Madoff, the banks take a big share of the stolen money. That's why there is always the suspicion that they weren't just innocent bystanders.

12 posted on 02/16/2011 7:45:00 AM PST by Walts Ice Pick ("I'm not going to shut up!" - Sarah Palin)
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To: pnh102

Because only Fedzilla gets to run a Ponzi scheme.


13 posted on 02/16/2011 7:53:13 AM PST by liberalh8ter
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To: pnh102

I don’t understand your confusion. Could you explain?


14 posted on 02/16/2011 7:53:43 AM PST by DManA
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To: Walts Ice Pick

How many banks were involved? There were a lot of people banking money too. So how did the banks know that the money came from a ponzi scheme? Did Madoff tell them it was fraudulent money?


15 posted on 02/16/2011 7:55:55 AM PST by ReverendJames (Only A Painter Or A Liberal Can Change Black To White)
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To: Liz

The banks “had” to know, but he also said that the Wilpons had NO idea...yeah..right..


16 posted on 02/16/2011 7:56:07 AM PST by ken5050 (Admin Moderators rule!!!!)
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To: pnh102

With the exception of a first-degree murder case where the death penalty is involved, nothing will get you harsher treatment in the U.S. criminal justice system than a financial crime that costs a lot of wealthy people and financial institutions a lot of money and damages the credibility of our financial system — especially if they come out looking like fools in the process.


17 posted on 02/16/2011 7:59:58 AM PST by Alberta's Child ("If you touch my junk, I'm gonna have you arrested.")
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To: ReverendJames
Well, I'm not saying any particular bank did or didn't do anything in the Madoff situation. But, I can tell you that when banks become involved in servicing huge accounts like Madoff, they have an interest in understanding the business they're involved with servicing.

A total outsider, Harry Markopolous was able to spot the fraud just on the basis of what Madoff was reporting as returns. Does it really seem to you impossible that banks who were working with Madoff on a daily business might have suspected fraud?

18 posted on 02/16/2011 8:07:05 AM PST by Walts Ice Pick ("I'm not going to shut up!" - Sarah Palin)
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To: Walts Ice Pick

Most likely they turned a blind eye to it.


19 posted on 02/16/2011 8:10:48 AM PST by ReverendJames (Only A Painter Or A Liberal Can Change Black To White)
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To: safetysign
First thing I thought of when I heard this:
1.He found an excuse that could credibly be considered more greedy & hated than he was,
2. He's trying to deflect guilt from the rest of his family,
3. This guy has no remorse.
20 posted on 02/16/2011 8:16:11 AM PST by AmericaUnite
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