News Outlet Turns To Distinguished Pathological Liar For Market Insight

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...and is discouraged to find out that, according to Bernie Madoff and other felons interviewed, it's essentially impossible to make money without committing fraud.

The financial criminals we spoke with said that not only do many investors routinely skirt insider-trading laws, but the explosion of computerized high-speed trading in recent years has made the situation even more unfair for the retail investor...MarketWatch spoke with four ex-brokers, three of whom are in prison with years to go on their sentences and a fourth who is out of prison and advises others about to enter custody. To get a perspective on the world of accounting fraud, MarketWatch also spoke with a former chief financial officer of a publicly traded company behind a well-known criminal enterprise. Among them was the poster child for brokers-turned-felons: Bernie Madoff...On a smaller scale, MarketWatch spoke with the so-called Bernie Madoff of New Jersey, an ex-broker who is now behind bars for running a Ponzi scheme. He said insider trading is impossible to stop and that retail investors will never be able to compete with the pros unless they splash out for sophisticated, and expensive, trading tools.

An ex–New York stockbroker and hedge-fund manager currently serving 16 years for defrauding investors said insider trading is a black hole that leaves regulators in the dark. A former Wall Street broker who spent 12 years as a broker at big New York investment banks before pleading guilty to wire fraud says no one on Wall Street can be successful without cheating.

Madoff, other felons say markets are unfair [MarketWatch]

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Bernie Madoff Was Just Trying To "Change The Way Money Was Managed," Not That Anyone Cares

For about a year now, Bernie Madoff has been holding court with various members of the press about something that's been plaguing him: the fact that few people if any are willing to give credit where credit is due. Yes, he may have pleaded guilty to a $50 billion crime that ruined countless people's lives, including those of his wife and children, one of whom committed suicide as a result, but he did a lot of other stuff too, like run a "successful business" for which he won lots of "industry awards" during his "legitimate years." And, yet, everyone seems to forget all that when his name comes up, much like they conveniently forgot about how Mussolini made the trains run or time, or how Hitler built those wonderful autobahns, or how Ted Bundy made women feel special. And since he's serving a 150 year sentence, Berns has had lots of time to ponder why his years of legitimate achievements go unmentioned and the one thing he keeps coming back to? Irving Picard, who's pulled a fast one on you all, by suggesting that Bernie's crime started wayyyyy before it did, when, in fact, Madoff Securities was only running a Ponzi scheme for barely even 20 years. Examine the evidence Madoff shared with Forbes contributor Diana B. Henriques via email: Jan. 17, 2011 11:05 A.M. … Also remember that the U.S. Attorney admitted that they had no evidence that the crime started in the 80’s and could establish that Montauk and the N.Y. homes in Ruth’s name were not purchased with tainted funds … Mar. 10, 2011 7:35 A.M. … I would love to know what evidence [Picard] has to date my crime back to 1983 … THE FACT IS THAT THERE IS NONE. 8:05 A.M. … I say once again the fraud started in the 90’s … Mar. 18, 2011 9:26 A.M. … I guess I’m obsessed with this START OF CRIME ISSUE. Don't you see, idiots of the media?! That's the real issue here. Not the crime itself but the start of the crime. Do the math. Oct. 11, 2011 7:20 A.M. ... You can do a back of the envelope calculation as follows. From 1963 I made substantial arbitrage profits for the Picower, Shapiro and Chais families joined by the Levy family in 1970. [M]ost of these profits were re­invested and the amounts compounded. In 1970 Saul Alpern formed his partnerships later [run] by Avellino and Bienes. In 1980 I started trading for [French banker] Albert Igoin and his French and Swiss banking associates. All of these accounts averaged about 20% annually and were involved in various forms of convertible arb using bonds, pfds [preferreds], Rts. [rights] and units. [A]nd ALL WERE LEGITIMATE TRADING. THIS CONTINUED THRU THE EARLY 90’S. Nov. 24, 2011 6:51 P.M. … When you look at my RIDDLE [in the Nov. 23 letter], consider the fact that there was in fact no crime until I did not have enough capital in the firm to cover the losses. There is your real STORY The interesting thing here is not that there was an 11-figure fraud, okay? The interesting thing is how long the 11-figure fraud went on. And it stinks to high hell that that slippery fuck Picard and Co. are claiming it dates back to 1983 and that you're all buying it, hook, line and sinker. Come on, people. They're lawyers. Who are you gonna trust, them or a Ponzi schemer? But don't feel sorry for Bernie. Feel sorry for yourselves, for what could have been and what never was. Near the end of that e-mail the clouds of self-deception close in again, and Madoff turns himself into a pitiful martyr: “I made the tragic mistake of trying to change the way money was managed and was successful at the start, but lost my way after a while and refused to admit that I failed at one point.” HE WAS TRYING TO THE WAY MONEY WAS MANAGED! A legitimate way to make Ponzi scheme payments, before it was tragically snuffed out. Oct. 11, 2011 7:36 A.M. … I will never get over the distortions being presented by everyone as to the poor and now homeless when in fact they all signed documents when opening their accounts that they were sophisticated and had enough wealth to withstand the possible losses of short term trading. I wish I had saved the hundreds of letters I received thanking me for how I was responsible for their happiness over the years and their pleading with me to keep their accounts open when I tried to close them … when I worried about the wreckage I might cause if I couldn’t recover. Is the REAL STORY that the investor agreements specifically authorized BLMIS to make Ponzi scheme payments (a totally legitimate type of securities transaction, a short term trade if you will)? Unless someone pulls their head out of their ass, the world will never know. Exclusive: The Secret Madoff Prison Letters [Forbes]

Former Madoff Employee Pleads Guilty To *A* Madoff Securities Scam Just Not *The* Madoff Securities Scam

You know what has got to suck? When you decide to start charging stuff that doesn't fall under "business expenses" to your corporate card and engage in a few other amateur hours scams that probably wouldn't have been found out (or, if discovered, not taken to the authorities because your boss had high tolerance for fraud) but then they are because the CEO of your firm had to go and engage in the largest Ponzi scheme on record, which shone an uncomfortable light on company personnel and all of the cheese, popcorn, and salsa of the month clubs you joined (for example).  Craig Kugel knows what we're talking about. The son of a longtime trader for convicted Ponzi scheme operator Bernard Madoff pleaded guilty to conspiracy and other criminal charges Tuesday, but denied any involvement in the decades-long fraud. Craig Kugel, the son of David L. Kugel, a former supervisory trader in Madoff's proprietary-trading operation, admitted to filing false forms that claimed people were on the Madoff payroll when they didn't actually work for the firm and to not declaring as income personal expenses charged to the firm's corporate credit card. Those individuals were paid salary and benefits, but weren't actual employees, he said. "I am sorry for my lapses in judgment in committing these federal crimes, but I want to make clear I had nothing to do with the Madoff Ponzi scheme and I was never involved in the Madoff trading operation," Craig Kugel said at a hearing before U.S. District Judge Laura Taylor Swain in Manhattan. Ex-Madoff Employee Pleads Guilty to Conspiracy [WSJ]