I predicted that the original estimates of $50 Billion would be upped as investigators got into the Madoff accounts.  Yesterday, they announced that the amount of the losses was increased to $65 Billion, and I would bet the number goes higher before this is over.

The question becomes why wasn’t the number accurate to start with?  Monday, following the 60 Minutes Redux piece covering Harry Markopolos’ ground breaking work on Madoff, the SEC IG went into take a 3 hour statement from Madoff, presumably on who at the SEC rejected his original findings presented no fewer than 5 times formally, and how they could justify ignoring his analytical work.

I would bet that the SEC IG will again find specific failures on the part of the SEC staff, which findings they will reject as being without foundation.  The SEC IG is clearly unarmed for this battle, and he needs to bring in the DOJ and the FBI.  If that doesn’t happen, the SEC must be broken up, along with its close associate, FINRA.

How hard is it to understand this?  This counterfeiting crisis was facilitated by committees chaired and mentored by Madoff, to the point that the options market maker exemption was actually named the Madoff Exemption (exempted from having to borrow to make short sales).  I wrote a piece well over a year ago, pulling together many pieces I wrote over the last six years for others that comprehensively covered this scandal.

I don’t know why this wasn’t responded to, but it wasn’t.  If the SEC IG can’t do his job, he should resign in protest.  He is doing no one any good here, except to embarrass the SEC Staff, who, in their amorality and sociopathy, can’t be shamed. This problem will eventually be resolved.  I am reminded of the old Tina Turner song, “We can do it nice, or we can do it ROUGH.”  Many victims today would prefer to see it done rough..