Saturday, December 20, 2008

Another SEC Investigation of Bernie That Went Nowhere

Sixteen years ago two accountants raised $400 million that went undetected by the SEC.

The two accountants from Florida promised investors steady annual returns of 13.5% to 20%. When they finally heard about it, the SEC thought they has a Ponzi scheme on their hands. How were the accountants showing such returns? Turns out, they put the money with a powerful mysterious Wall Streeter that the SEC did not name at the time: Bernard Madoff. The accountants closed down their business. The case was closed.

John Carney found this blockbuster story, possibly 10,786 pages or more deep into a Google search. But find it, he did.

He has all the details, here, including large clips from WSJ which seemed a bit skeptical even back then of Madoff's explanation for how he was making his steady returns. Yet, somehow he passed SEC scrutiny back then, also.

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