Monday, April 5, 2010

Bernie Madoff's Assistants Get Indicted

Special Comment:
I am adding this little note because of the earthquake in California yesterday. My regular blather is below.

We had a very strong earthquake yesterday across southern California. It is reported to be a 7.2 quaker and it lasted for a good 30 to 40 seconds. If you have never felt one, those 30 seconds or so can feel like an hour. It's like being on a small boat in choppy waters, everything rolls up and down. Some people say it feels a little like a roller coaster. It can be a pretty frightening experience when the walls start leaning and the pictures start coming down around you.

Right after the quake ended my phone starting ringing off the hook. I have several friends that have never been through this before. One friend of mine is a student from another country. He had just finished a shower and was sitting on his couch in nothing but his tee-shirt and shorts when the earthquake started. He did not know what to do so he grabbed up his lap top computer (with all his college course work on it). his passport (his single most valuable possession) and a flashlight (in the middle of the afternoon) and ran outside into the street. As funny as that sounds, considering he had never felt one before and only had a few short seconds to react, those were actually fairly smart moves. Even if you have things prepared for an emergency like this, those are things which help you deal with the aftermath. An earthquake strikes without warning. When it happens you barely have time to secure yourself, your loved ones and maybe one or two valuables within easy reach.

As for me, I barely had time to calm my dog and enjoy the ride before it ended. Being from California, this was hardly my first earthquake experience and will surely not be the last. I do not like to give advise to others about things like this, but as for me, I just say "thanks for getting me through it", then I enjoy talking about it with my friends and waiting for the next one....


We often hear stories about crooks like Bernie Madoff and how he ripped off so many people, stealing their money and savings and ruining their lives. What we do not hear much about is what happens to the people that helped with the crime. We all know that Bernie did not run his company and steal all that money by himself.

What seems to happen so often is that the main characters are charged with crimes and then everyone seems satisfied and there's an end to the whole story, until it happens again. The problem with that is simply that it overlooks the fact that here are always people who are involved and who wind up getting off free. I was really angry when Enron went bankrupt and they only indicted a couple of the main players (the CEO and CFO). There were a large number of people manipulating the energy supply and artificially raising electric prices for thousands of people just to increase their personal profits. No one ever went after those people to hold them to account. Most of them are now working in other companies and are in positions to do it all again. The only difference is that this time they will be a little harder to catch.

That is why I was glad to read that two Madoff Investment (BLMIS) employees are facing up to 30 years in jail for designing special software programs that contained fraudulent financial records and data.

Preet Bharara, the United States Attorney for the Southern District of New York, announced that JEROME O’HARA and GEORGE PEREZ - former computer programmers for Bernard L. Madoff Investment Securities, LLC (”BLMIS”) - were indicted by a federal grand jury in Manhattan on charges of conspiracy, falsifying records of a broker-dealer, and falsifying records of an investment adviser.

Beginning in 1990 and 1991, respectively, O’HARA and PEREZ were employed as computer programmers at BLMIS. They primarily were responsible for developing and maintaining computer programs that supported the operation of the BLMIS investment advisory business (the “IA business”).

Madoff was convicted in March of 2009 after reaching an agreement, pleading guilty to 11 federal offenses including wire fraud, perjury and securities laws in a Ponzi scheme that defrauded investors of $65 billion.

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