Blog on the Run: Reloaded

Monday, March 1, 2010 8:44 pm

Meet Harry “Cassandra” Markopoulos

OK, Cassandra wasn’t Greek, she was Trojan. But she was the chick to whom the god Apollo gave the gift of prophecy … and, because she then wouldn’t be  his girlfriend, the curse of never being believed.

Harry Markopoulos can relate. He was a money manager who was ordered by his bosses to find ways to equal Bernie Madoff’s return on investments. He calculated that it was statistically impossible, then spent years trying unsuccessfully to bring the wrath of the Securities & Exchange Commission down on Madoff. It turns out that Markopoulos was right, that the reason Madoff’s “returns” were so high was because he was running a $65 billion pyramid scheme that cost a lot of people (including, I am reliably informed, some folks right here in River City) a ton of money, and that the SEC was “comatose” (if not on the take, I hypothesize).

Not surprisingly, Markopoulos doesn’t think very highly of the SEC, and the feeling apparently is mutual:

Why do you think the S.E.C. failed to wake up to Madoff’s $65 billion Ponzi scheme until he turned himself in?
They weren’t even asleep at the switch; they were comatose. They didn’t respond to heat and light, much less evidence of wrongdoing. They were not engaged in the fight.

This was when William Donaldson was head of the S.E.C.?
Donaldson was too tough on Wall Street, so he got the ax. Then you had Christopher Cox, because he wasn’t going to do his job. That’s why he got the job.

You met last year with Mary Schapiro, the current head of the S.E.C. How did that go?
I would say she was coldly polite. Her general counsel, David Becker, did most of the talking. He and I did not get along at all. He was getting ready to come across the coffee table and strangle me.

(h/t: Ed)

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