Yom Kippur Morning 5770 Lehman Brothers, Failed
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Special Committee Report
REPORT OF THE 2009 SPECIAL REVIEW COMMITTEE ON FINRA’S EXAMINATION PROGRAM IN LIGHT OF THE STANFORD AND MADOFF SCHEMES SEPTEMBER 2009 SPECIAL REVIEW COMMITTEE Charles A. Bowsher (Chairman) ———————————— Ellyn L. Brown ———————————— Harvey J. Goldschmid ———————————— Joel Seligman ———————————— INDUSTRY GOVERNOR ADVISERS OF COUNSEL Mari Buechner Paul V. Gerlach W. Dennis Ferguson Griffith L. Green G. Donald Steel Dennis C. Hensley Michael A. Nemeroff SIDLEY AUSTIN LLP 1501 K Street, NW Washington, DC 20005 TABLE OF CONTENTS I. EXECUTIVE SUMMARY .............................................................................................. 1 A. The Stanford Case................................................................................................. 2 B. The Madoff Case................................................................................................... 4 C. Recommendations................................................................................................. 6 II. BACKGROUND ON FINRA EXAMINATION PROGRAM...................................... 9 III. EXAMINATIONS OF MEMBER FIRMS INVOLVED IN THE STANFORD AND MADOFF SCANDALS.................................................................. 11 A. The Stanford Case............................................................................................... 12 1. Background............................................................................................... 12 2. Daniel Arbitration and 2003 Cycle Examination...................................... 13 3. 2003 -
Stanford Ponzi Scheme: Lessons for Protecting Investors from the Next Securities Fraud
THE STANFORD PONZI SCHEME: LESSONS FOR PROTECTING INVESTORS FROM THE NEXT SECURITIES FRAUD HEARING BEFORE THE SUBCOMMITTEE ON OVERSIGHT AND INVESTIGATIONS OF THE COMMITTEE ON FINANCIAL SERVICES U.S. HOUSE OF REPRESENTATIVES ONE HUNDRED TWELFTH CONGRESS FIRST SESSION MAY 13, 2011 Printed for the use of the Committee on Financial Services Serial No. 112–30 ( U.S. GOVERNMENT PRINTING OFFICE 66–868 PDF WASHINGTON : 2011 For sale by the Superintendent of Documents, U.S. Government Printing Office Internet: bookstore.gpo.gov Phone: toll free (866) 512–1800; DC area (202) 512–1800 Fax: (202) 512–2104 Mail: Stop IDCC, Washington, DC 20402–0001 VerDate Nov 24 2008 17:24 Aug 25, 2011 Jkt 066868 PO 00000 Frm 00001 Fmt 5011 Sfmt 5011 K:\DOCS\66868.TXT TERRIE HOUSE COMMITTEE ON FINANCIAL SERVICES SPENCER BACHUS, Alabama, Chairman JEB HENSARLING, Texas, Vice Chairman BARNEY FRANK, Massachusetts, Ranking PETER T. KING, New York Member EDWARD R. ROYCE, California MAXINE WATERS, California FRANK D. LUCAS, Oklahoma CAROLYN B. MALONEY, New York RON PAUL, Texas LUIS V. GUTIERREZ, Illinois DONALD A. MANZULLO, Illinois NYDIA M. VELA´ ZQUEZ, New York WALTER B. JONES, North Carolina MELVIN L. WATT, North Carolina JUDY BIGGERT, Illinois GARY L. ACKERMAN, New York GARY G. MILLER, California BRAD SHERMAN, California SHELLEY MOORE CAPITO, West Virginia GREGORY W. MEEKS, New York SCOTT GARRETT, New Jersey MICHAEL E. CAPUANO, Massachusetts RANDY NEUGEBAUER, Texas RUBE´ N HINOJOSA, Texas PATRICK T. MCHENRY, North Carolina WM. LACY CLAY, Missouri JOHN CAMPBELL, California CAROLYN MCCARTHY, New York MICHELE BACHMANN, Minnesota JOE BACA, California THADDEUS G. McCOTTER, Michigan STEPHEN F. -
Exhibit a Pg 1 of 40
09-01161-smb Doc 246-1 Filed 03/04/16 Entered 03/04/16 10:33:08 Exhibit A Pg 1 of 40 EXHIBIT A 09-01161-smb Doc 246-1 Filed 03/04/16 Entered 03/04/16 10:33:08 Exhibit A Pg 2 of 40 Baker & Hostetler LLP 45 Rockefeller Plaza New York, NY 10111 Telephone: (212) 589-4200 Facsimile: (212) 589-4201 Attorneys for Irving H. Picard, Trustee for the substantively consolidated SIPA Liquidation of Bernard L. Madoff Investment Securities LLC and the Estate of Bernard L. Madoff UNITED STATES BANKRUPTCY COURT SOUTHERN DISTRICT OF NEW YORK SECURITIES INVESTOR PROTECTION CORPORATION, No. 08-01789 (SMB) Plaintiff-Applicant, SIPA LIQUIDATION v. (Substantively Consolidated) BERNARD L. MADOFF INVESTMENT SECURITIES LLC, Defendant. In re: BERNARD L. MADOFF, Debtor. IRVING H. PICARD, Trustee for the Liquidation of Bernard L. Madoff Investment Securities LLC, Plaintiff, Adv. Pro. No. 09-1161 (SMB) v. FEDERICO CERETTI, et al., Defendants. 09-01161-smb Doc 246-1 Filed 03/04/16 Entered 03/04/16 10:33:08 Exhibit A Pg 3 of 40 TRUSTEE’S FIRST SET OF REQUESTS FOR PRODUCTION OF DOCUMENTS AND THINGS TO DEFENDANT KINGATE GLOBAL FUND, LTD. PLEASE TAKE NOTICE that in accordance with Rules 26 and 34 of the Federal Rules of Civil Procedure (the “Federal Rules”), made applicable to this adversary proceeding under the Federal Rules of Bankruptcy Procedure (the “Bankruptcy Rules”) and the applicable local rules of the United States District Court for the Southern District of New York and this Court (the “Local Rules”), Irving H. -
Financial Panics and Scandals
Wintonbury Risk Management Investment Strategy Discussions www.wintonbury.com Financial Panics, Scandals and Failures And Major Events 1. 1343: the Peruzzi Bank of Florence fails after Edward III of England defaults. 2. 1621-1622: Ferdinand II of the Holy Roman Empire debases coinage during the Thirty Years War 3. 1634-1637: Tulip bulb bubble and crash in Holland 4. 1711-1720: South Sea Bubble 5. 1716-1720: Mississippi Bubble, John Law 6. 1754-1763: French & Indian War (European Seven Years War) 7. 1763: North Europe Panic after the Seven Years War 8. 1764: British Currency Act of 1764 9. 1765-1769: Post war depression, with farm and business foreclosures in the colonies 10. 1775-1783: Revolutionary War 11. 1785-1787: Post Revolutionary War Depression, Shays Rebellion over farm foreclosures. 12. Bank of the United States, 1791-1811, Alexander Hamilton 13. 1792: William Duer Panic in New York 14. 1794: Whiskey Rebellion in Western Pennsylvania (Gallatin mediates) 15. British currency crisis of 1797, suspension of gold payments 16. 1808: Napoleon Overthrows Spanish Monarchy; Shipping Marques 17. 1813: Danish State Default 18. 1813: Suffolk Banking System established in Boston and eventually all of New England to clear bank notes for members at par. 19. Second Bank of the United States, 1816-1836, Nicholas Biddle 20. Panic of 1819, Agricultural Prices, Bank Currency, and Western Lands 21. 1821: British restoration of gold payments 22. Republic of Poyais fraud, London & Paris, 1820-1826, Gregor MacGregor. 23. British Banking Crisis, 1825-1826, failed Latin American investments, etc., six London banks including Henry Thornton’s Bank and sixty country banks failed. -
Hedge Funds: Due Diligence, Red Flags and Legal Liabilities
Hedge Funds: Due Diligence, Red Flags and Legal Liabilities This Website is Sponsored by: Law Offices of LES GREENBERG 10732 Farragut Drive Culver City, California 90230-4105 Tele. & Fax. (310) 838-8105 [email protected] (http://www.LGEsquire.com) BUSINESS/INVESTMENT LITIGATION/ARBITRATION ==== The following excerpts of articles, arranged mostly in chronological order and derived from the Wall Street Journal, New York Times, Reuters, Los Angles Times, Barron's, MarketWatch, Bloomberg, InvestmentNews and other sources, deal with due diligence in hedge fund investing. They describe "red flags." They discuss the hazards of trying to recover funds from failed investments. The sponsor of this website provides additional commentary. "[T]he penalties for financial ignorance have never been so stiff." --- The Ascent of Money (2008) by Niall Ferguson "Boom times are always accompanied by fraud. As the Victorian journalist Walter Bagehot put it: 'All people are most credulous when they are most happy; and when money has been made . there is a happy opportunity for ingenious mendacity.' ... Bagehot observed, loose business practices will always prevail during boom times. During such periods, the gatekeepers of the financial system -- whether bankers, professional investors, accountants, rating agencies or regulators -- should be extra vigilant. They are often just the opposite." (WSJ, 4/17/09, "A Fortune Up in Smoke") Our lengthy website contains an Index of Articles. However, similar topics, e.g., "Bayou," "Madoff," "accountant," may be scattered throughout several articles. To locate all such references, use your Adobe Reader/Acrobat "Search" tool (binocular symbol). Index of Articles: 1. "Hedge Funds Can Be Headache for Broker, As CIBC Case Shows" 2. -
The Global Economy, Economic Crisis, and White-Collar Crime
Contents Volume 9 • Issue 3 • August 2010 SPECIAL ISSUE The Global Economy, Economic Crisis, and White-Collar Crime EDITORIAL INTRODUCTION White-collar crime and the Great Recession .......................................................................429 Neal Shover, Peter Grabosky WALLS OF SECRECY AND SILENCE RESEARCH ARTICLE. Walls of secrecy and silence: The Madoff case ..........................................435 and cartels in the construction industry Henk van de Bunt POLICY ESSAY. Secrecy, silence, and corporate crime reforms ..................................................455 William S. Laufer POLICY ESSAY. Silent or invisible? Governments and corporate financial crimes .....................467 John Minkes POLICY ESSAY. How to effectively get crooks like Bernie Madoff in Dutch .............................475 Henry N. Pontell, Gilbert Geis POLICY ESSAY. Getting our attention .......................................................................................483 Nancy Reichman SERIOUS TAX FRAUD AND NONCOMPLIANCE RESEARCH ARTICLE. Serious tax fraud and noncompliance: A review of evidence ....................493 on the differential impact of criminal and noncriminal proceedings Michael Levi POLICY ESSAY. Criminal prosecution within responsive regulatory practice ............................515 Valerie Braithwaite POLICY ESSAY. Fairness matters—more than deterrence: .........................................................525 Class bias and the limits of deterrence Paul Leighton POLICY ESSAY. Serious tax noncompliance: Motivation -
Congressional Record—House H1653
February 23, 2009 CONGRESSIONAL RECORD — HOUSE H1653 the Olympic torch on its route through BILLS PRESENTED TO THE ∑ Division H—Department of State, For- Cleveland for the 2002 Olympic Games PRESIDENT eign Operations, and Related Programs Ap- propriations Act, 2009; in Salt Lake City, Utah. He is a mem- Lorraine C. Miller, Clerk of the ∑ Division I—Transportation, Housing and ber of Tau Boule and holds life mem- House reports that on February 4, 2009 berships in Kappa Alpha Psi Fraternity Urban Development, and Related Agencies she presented to the President of the Appropriations Act, 2009; and and the NAACP. United States, for his approval, the fol- ∑ Mr. Speaker, I thank you. I thank Division J—Further Provisions Relating lowing bill. to the Department of Homeland Security and my colleagues, and again, I thank this H.R. 2. To amend title XXI of the Social Other Matters. Nation for recognizing that black his- Security Act to extend and improve the Chil- Section 3 states that, unless expressly pro- tory is indeed American history. dren’s Health Insurance Program, and for vided otherwise, any reference to ‘‘this Act’’ f other purposes. contained in any division shall be treated as referring only to the provisions of that divi- LEAVE OF ABSENCE Lorraine C. Miller, Clerk of the House reports that on February 16, 2009 sion. By unanimous consent, leave of ab- she presented to the President of the DIVISION A sence was granted to: United States, for his approval, the fol- TITLE I—AGRICULTURAL PROGRAMS Ms. EDDIE BERNICE JOHNSON of Texas lowing bill. -
CPY Document
1488 FEDERAL TRADE COMMISSIOX DECISIO COllpl11int fjG F.T.C. (1) In thrce of these ca::es , 1.1Iere is no quorum 01 the Commission at the present time for rendering adjudicative decisions on the merits and i sning' any orc1c1's to cease and desist based upon findings of i()htinll (If l:1\Y. \d.ilJlicatioll of thes(' cnses ,,'olll(ll'eql1ire reaTf2"lment of the appeals. The slwljtj(: priLclices challenged in these cases occurred aln10st a. c1ecade ago, in the mid- 1950' , and competitive cOllclitions in this dynamic and rapidly changing indust.ry appenr to luLY8 altered significantly since then. (2.) The Commission has this elat.e annollllced the initiation of a broad inquiry into the problems of competition in the marketing of gasoline. Orders to cease and desist entered against a few oil com- panies-orders whic.h ,yould probably not become final , if at all, until Gompletion of lengthy reyic\';' proceedings in the Federal Courts of Appeals and the Supreme Court-conld not proyjde complete or ef- fective solution 10 the competitive problems of the gasoline industr;.v. It ,yould appeario be more desirable from the standpoint of efIec- tive administration of the Jaw , that the Commission concentrate its necessarily limited resources on a. comprehensive industry-wide ap proac.h to the prohlems of competition in the marketing of gasoline. Commissioner Dixon not participating and with Commissioner 1\-1ac- 1ntyre dissenting for the reasons stated by him in the accompanying dissenting opinion. Ix THE NUTTR OF CROWN PUBLISHERS, lNG, ET AL. ORDER : OP1XTQ::"' , 'ETC. , IX REGARD TO TIlE ALLEGED VlOLATION OF THE FEERAL TRADE COMMISSION ACT Docket 85!J8. -
Anatomy of a Financial Fraud: Madoff, Stanford, and the $100 Billion Shell Game
The University of Texas School of Law 2009 Page Keeton Civil Litigation Conference October 29-30, 2009 Austin, Texas Anatomy of a Financial Fraud: Madoff, Stanford, and the $100 Billion Shell Game Stephen F. Malouf Stephen F. Malouf The Law Offices of Stephen F. Malouf, P.C. 3811 Turtle Creek Blvd., Suite 1600 Dallas, Texas 75219 (214) 969-7373 [email protected] Continuing Legal Education • 512-475-6700 • www.utcle.org Anatomy of a Financial Fraud: Madoff, Stanford, and the $100 Billion Shell Game I. INTRODUCTION On December 11, 2008, FBI Special Agent Theodore Cacioppi met with Bernard Madoff at Madoff’s apartment in New York. after the FBI was informed by certain Madoff employees that Madoff had confessed to them that “in substance, ...his investment advisory business was a fraud.”1 According to Cacioppi: After identifying myself, MADOFF invited me, and the FBI agent who accompanied me, into his apartment. He acknowledged knowing why we were there. After I stated, “we're here to find out if there's an innocent explanation." MADOFF stated, “There is no innocent explanation." MADOFF stated, in substance, that he had personally traded and lost money for institutional clients, and that it was all his fault. MADOFF further 'stated, in substance, that he ~paid investors with money that wasn't there." MADOFF also said that he was “broke" and "insolvent" and that he had decided that “it could not go on," and that he expected to go to jail. MADOFF also stated that he had recently admitted what he had done to Senior Employee Nos. -
United States District Court Northern District of Texas Dallas Division
Case 3:16-cv-01152-C Document 1 Filed 04/28/16 Page 1 of 99 PageID 1 UNITED STATES DISTRICT COURT NORTHERN DISTRICT OF TEXAS DALLAS DIVISION SANDRA DORRELL and PHILLIP A. § WILKINSON, individually and on behalf of § a class of all others similarly situated, § Plaintiffs, § § vs. § § CIVIL ACTION NO. 3:16-cv-1152 PROSKAUER ROSE, LLP, and § THOMAS V. SJOBLOM, § § Defendants. § PLAINTIFFS’ ORIGINAL COMPLAINT Case 3:16-cv-01152-C Document 1 Filed 04/28/16 Page 2 of 99 PageID 2 TABLE OF CONTENTS I. PREFACE ........................................................................................................................ 1 II. PARTIES ......................................................................................................................... 3 III. PERSONAL JURISDICTION ....................................................................................... 4 IV. SUBJECT MATTER JURISDICTION AND VENUE ................................................ 5 V. FACTUAL BACKGROUND ......................................................................................... 5 A. The Stanford Financial Group Empire ........................................................................ 5 B. Stanford Financial’s Operations in the United States .................................................. 7 C. The Anatomy of the Stanford Ponzi Scheme .............................................................. 9 1. The Beginning: Guardian International Bank ...................................................... 11 2. Stanford Creates a Safe Haven in -
S Finance Chief to Plead Guilty
MADOFF’S FINANCE CHIEF TO PLEAD GUILTY For those of you complaining that I’m not reporting on 3-year old Sibel Edmonds revelations, here’s some news that may offer fresh new insight into the sordid world of international crime and power. Frank DiPascali, the finance chief at Bernard Madoff’s investment advisory business who agreed to plead guilty, could help prosecutors build criminal cases against other players in his boss’s $65 billion Ponzi scheme. DiPascali, 52, is scheduled to enter his plea tomorrow in federal court in Manhattan, U.S. Attorney Lev Dassin told a judge in an Aug. 8 letter that didn’t specify the charges. DiPascali would waive indictment and plead guilty, which signals to lawyers that he is cooperating to lessen his prison term. "I believe he’s cooperating," said John J. Fahy, a former federal prosecutor not involved in the case. "He would be very valuable to the government because he has been close to Madoff for so many years and had to have seen some of the fraudulent transactions that went on. From what we know of Madoff, he trusted very few people." Madoff, of course, has gone off to prison without really telling anyone where the bodies are buried, where the money went, or even who on Wall Street knew and facilitated his scheme. We won’t know for some time how cooperative DiPascali will be, but if he is cooperative, and if he does know where even a few of the bodies are buried, his cooperation might free up information that is otherwise, thus far, successfully buried. -
Taming the Tort Monster: the American Civil Justice System As a Battleground of Social Theory Michael L
Brooklyn Law Review Volume 68 | Issue 1 Article 1 9-1-2002 Taming the Tort Monster: The American Civil Justice System as a Battleground of Social Theory Michael L. Rustad Thomas H. Koenig Follow this and additional works at: https://brooklynworks.brooklaw.edu/blr Recommended Citation Michael L. Rustad & Thomas H. Koenig, Taming the Tort Monster: The American Civil Justice System as a Battleground of Social Theory, 68 Brook. L. Rev. 1 (2002). Available at: https://brooklynworks.brooklaw.edu/blr/vol68/iss1/1 This Article is brought to you for free and open access by the Law Journals at BrooklynWorks. It has been accepted for inclusion in Brooklyn Law Review by an authorized editor of BrooklynWorks. Brooklyn Law Review Volume 68 2002 Number 1 ARTICLES TAMING THE TORT MONSTER: THE AMERICAN CIVIL JUSTICE SYSTEM AS A BATTLEGROUND OF SOCIAL THEORY' Michael L. Rustadt & Thomas H. Koenig* 02002 Michael L. Rustad & Thomas H. Koenig. All Rights Reserved. Michael L. Rustad is the Thomas F. Lambert Jr. Professor of Law and Director of the Intellectual Property Law Program at Suffolk University Law School School. B.A. 1971, University of North Dakota; M.A. 1973, University of Maryland; Ph.D. 1981, Boston College; J.D. 1984, Suffolk University Law School; LL.M. 1986, Harvard University Law School. Thomas Koenig is Professor, Department of Sociology and Law, Policy and Society Doctoral Program, Northeastern University. A.B. 1971, University of California, Santa Cruz; M.A. 1973, University of California Santa Barbara; Ph.D. 1979, University of California, Santa Barbara. This article is dedicated to the memory of Thomas F.