Writes Andrew Fitzgerald:
My wife had the Today Show on this morning to which I usually don't pay any attention, but Matt Lauer was interviewing Harry Markopolos who I had seen interviewed before on Frontline. Markopolos was a competing trader tasked with figuring out Madoff's secret to such great returns. He said that he conclusively determined his operation to be a fraud in 30 minutes and over the next several years informed the SEC four separate times. He said that the big problem with the SEC was that they're staffed with lawyers who don't know anything about money and investigating. I remember in the Frontline piece he said that it would have been easy enough for the SEC to contact every broker on the NYSE and find that none had ever placed a trade for Madoff.
The great parts of his interview this morning were when Lauer questioned him about his fears of being threatened by Madoff. Markopolos said that he bought a gun and if he were personally threatened by Madoff he planned to kill him since, "it was either him or me." Lauer looks at him quizzically asking how he would explain that to law enforcement. Markopolos, who doesn't exactly look like a Charles Bronson vigilante, said "well I'd hope not to get caught. I certainly had some good Army training, and it was really him or me. I had a family to protect. The government wasn't protecting me; they were not doing their jobs, and I felt forced into a rather difficult moral dilemma." Lauer ends the interview by asking him what lessons should investors learn from this mess. He answers, "don't trust your government."
I felt the whole interview had a great libertarian ring to it, with our government budget going to no good purpose except possibly training a would-be vigilante and the regulatory agency being warned repeatedly about the greatest private fraud in American history to no effect.