– From “Front and Center”, by C. Austin Burrell –

This week, Certified Fraud Examiner Harry Markopolos announced the release of his new book, “No One Would Listen”, about the complete stonewall he hit with US Government Regulators including the SEC and FINRA. He told his story in his typical low key and very professional manner, making his message all the more devastating.

I am sure that SEC, FINRA and other officials to whom he reported his findings on the scope of the Madoff fraud felt footfalls on their graves.

Starting with CNBC, and then going to Matt Lauer, CNN and FOX News, he recounted his story of his discovery of the Madoff fraud, which had been ongoing for many years, when he examined the claimed performance of Madoff’s split strike price conversion strategy, and his quick realization that he claimed performance that would have simply been impossible to produce. He recited the sequence of events that led him to conclude within 30 minutes that Madoff was a fraud. It is where it went from there that no one except people who had faced similar risks could imagine.

I come from an extensive derivative background and I have known everything about the history of conversions and reverse conversions for decades, literally. Like Mr. Markopolos, I had a serious math background, which had been the foundation of my move into the derivatives industry well over 33 years ago. I maintained many of my relationships in the industry as I moved into other areas later in my career, but I found myself drawn back into the space by the short selling scandal.

I knew what I had found in the illegal short selling manipulation scandal, enormous fraud involving all forms of organized crime globally.  What Markopolos did was to confirm that his research led him down the very same rabbit holes, to the same slimy criminals.  Slimy is not the right word though, slick and ruthless are better.

I was made more than a bit uncomfortable when he began to describe how a French nobleman had exposed him to contacts in Europe who warned him that Madoff was involved with serious organized crime, from the Red Mafiya, to the Columbian Drug Cartels, the Israeli Mob, and more. They didn’t hesitate to warn him that if he persisted, he would be at real personal physical risk, along with his family. I was told the same thing as I became more visible, and I was advised to go public as my only form of protection.

My situation mimicked his in other ways. I received repeated anonymous threats, vicious personal slanders from nameless, faceless parties. Harry was working with Federal authorities, and they warned him he would be at personal risk with anyone so powerful and with such enormous financial resources. Again, I did the same thing in taking my concerns to Federal authorities, providing them with rafts of information, but seeing no real elevation of my protection or safety.

Harry finally reached a point he described as being critical. Should he be threatened by Madoff directly or indirectly, he resolved to kill Madoff. He concluded that as well intentioned as the Feds might be, they were only going to be of value to him if the assassin missed. His interviewers were clearly shocked that he had been forced to reach this conclusive assessment of his risk and how to deal with it. He bought a gun and prepared himself. An Army ROTC product, he knew how to use guns and he was prepared mentally to protect his family.

I did the same, getting a Conceal Carry Permit, and upgrading my personal weapons for what I saw to be a real personal attack on me. Years with weapons made me quite comfortable with them, too much so. Others had died mysteriously around my space, and more had been threatened and intimidated. What all of us owe Harry is the harshest clarification that such threats really did exist, after a handful of us had been forced to take the threats to us seriously.

We had caught a sophisticated sociopathic network of people with serious criminal backgrounds stealing hundreds of billions of dollars from thousands of companies and millions of investors, and they had the means, motive and opportunity to make good on their threats. You can ask any police officer, local, State or Federal how you should react to this, and they will most frequently tell you to protect yourself.

I upgraded my alarm system, raised my alertness levels to a nearly hyper level I had in Vietnam, and waited, and wrote, building so much of a record in so many spaces that if anyone wanted to come after me, they would know that many people would be looking over things with a fine tooth comb till they found the perpetrators.

Each reader of this must watch these interviews, and they should keep them. This country is on the edge of an abyss, one where individual citizens are only safe if they make no noise or waves. Most of my peers won’t accept such personal insult.

One side story is that this book, which has all the critical elements of a great crime story, also has victims who were motion picture makers, producers, directors, and more. I am betting that this book will become a movie, and if that happens, we will no longer have to worry about the SEC or FINRA surviving except as highly subordinated elements (read “dogs”) of a much needed overhead Financial Regulatory Authority, one in which they would be held to standards that are a tragedy now.

A lot of lawyers need to be unemployed, with bad references, lost licenses, and no recourse. Until they are held to private company standards of ethical behavior that is spelled out, they will doom this country and everything it stands for. They have breached not only their oath of office, but the public trust. That is an act of sedition on the scale they have been operating on, and until someone of them goes to real jail for real time, they risk being targeted personally with civil litigation retaliation. Madoff was a symptom of a broken regulatory system that he played like a worn-out violin.

Harry called the SEC lawyers idiots, a vicious insult to real idiots everywhere. Regulators with these kinds of attitudes aren’t idiots, they are financial Ted Bundy’s, borderline sociopaths. Borderlines can’t be fixed, not by anything. Let God judge them.

Again, I extend every tribute to Mr. Harry Markopolos. The American people owe him a debt of gratitude. So do I and my compatriots.