Archive for CRIME & JUSTICE
Madoff auction raises $1m
|Madoff auction raises $1m
Nov 15, 2009
Bernie Madoff auction draws hundreds of bidders for Ponzi schemers possessions
Saturday, November 13th 2010, 2:37 PM
Hundreds of buyers flocked to the Midtown hotel ready to part with their hard-earned cash, and more than 1,000 online bidders also drove up the price of the goods once owned by the notorious swindler.
“I was going to buy another piano, so why not buy one with a little history to it?” said John Rodger, 81, from East Islip, L.I., who snapped up the Steinway and Sons grand piano for $42,000. “It makes it kind of interesting. It’s a conversation piece.”
He added, “It has a little bit of history to it and it’s a little hysterical too.”
Madoff’s size 8 1/2 size slippers can be yours. Getty
Auctioneers Gaston and Sheehan are overseeing the sale of the 489 lots, which were seized by U.S. Marshals after Madoff, who is serving 150 years in prison, was arrested for swindling investors out of $65 billion.
The auction was expected to raise at least $1.5 million and will go towards a fund for the victims. But with many of the items on the block selling for well above the initial asking price, the final figure for the stash could be much greater.
Madoff’s custom platinum ring with a 10.5-carat diamond is possibly worth $300,000. Getty
The rug had special significance for Zaman, who lives in Forest Hills, Queens: his father sold it to Madoff 10 years ago, and he felt it was important to bring it back into the family.
“I think it will be more valuable now with all that’s happened. It’s something people will talk about,” said Zaman, who didn’t know how much his father sold it for.
“It is in the same condition it was in when it was sold,” she added. “I’m glad we will have it back.”
This is the second auction of Madoff’s belongings. The first, last year, raised nearly $1 million, according to the U.S. Marshals.
American Casino: a NEW Documentary Expose’ on the Mortgage Industry’s Fraudulent Sub Prime Lending Practices and the Stories of their Victims. via [American Casino film site, Credit Writedowns, and Associated Press]
“American Casino is a powerful and shocking look at the subprime lending scandal. If you want to understand how the US financial system failed and how mortgage companies ripped off the poor, see this film.”
Joseph Stiglitz, Nobel prize-winning economist
“FASCINATING! A TERRIFIC documentary chronicling the subprime-mortgage mess and the financial collapse of the past two years…
With a rare cohesive power, the Cockburns fill in the lines of connection. They function a little like Raymond Chandler as he traces the corruption that produces, at the end of a long chain of circumstances, the lady in the lake…
The movie is a lucid and comprehensive picture of a rotten system.”
David Denby, The New Yorker
|“Politicians and the media like to talk about the relationship between Wall Street and Main Street, but investigative journalist Leslie Cockburn’s debut feature gets to the guts of the matter, visiting defectors from Bear Stearns and Standard & Poor’s and other high-level players in the subprime mortgage gamble and, on the flipside, visiting the working-class Americans who were the unwitting chips on the table.”— Tribeca Festival programmers 2009
“It is rare that a documentary director has the privilege to shoot a film that, while in production, becomes the greatest story of our time. The “worst case scenario” of January 2008, when we began work on American Casino, turned into reality in the year that followed. We were able to follow our characters through Wall Street’s collapse, foreclosure, bankruptcy, homelessness. We watched whole neighborhoods ravaged by the subprime meltdown. I have spent much of my career filming in war zones and post apocalyptic societies — Somalia, Iraq, Afghanistan. But I never expected such a disaster at home. To be there, with a camera, while it was happening, telling the story, was certainly the highlight of my career.”— Leslie Cockburn, Director
American Casino: How foreclosures breed mosquitoes
Posted by Edward Harrison
I have yet to see the film. However, below is a clip from the filmmakers Andrew and Leslie Cockburn on one unforeseen consequence of the recent financial crisis. Abandoned homes in newer California sub-divisions are a breeding ground for mosquitoes, increasing the threat of West Nile virus.
via [Credit Writedowns]
A Recent Mortgage Scandal news story:
Neighbors: Exec. moved into bank-owned beach home surrendered by Madoff duped couple
The Malibu Colony beach home, third house from left with a dark patio, was last owned by Lawrence and Linda Elins. The home’s value was recorded at $12 million when the property was transferred May 13, 2009, to Wells Fargo Bank. (Kenneth & Gabrielle Adelman / California Coastal Records Project)
Wells Fargo & Co. has fired an executive who reportedly partied and stayed at a bank-owned $12 million beach house in the exclusive Malibu Colony, the bank said Monday.
Bank spokeswoman Jennifer Langan confirmed that Cheronda Guyton, a senior vice president, was the only employee involved in the alleged violation of company policy.
“We deeply regret the activities that have taken place as they do not reflect the conduct we expect of our team members,” the bank said in a statement.
A Wells Fargo & Co. executive who oversees foreclosed properties hosted parties and spent long summer weekends in a $12 million Malibu beach house, moving into the home just after it had been surrendered to Wells Fargo to satisfy debts, neighbors said.
Neighbors told the Los Angeles Times they saw Guyton’s family at the house and that it was used for at least one party where guests were ferried from a yacht.
The previous owners of the beachfront home in Malibu Colony — a densely built stretch of luxury homes that has been a favorite of celebrities over the years — were financially devastated in Bernard Madoff’s massive fraud scheme, real estate agent Irene Dazzan-Palmer said.
The couple signed the property over to Wells Fargo last spring, and the bank subsequently denied requests to show the house to prospective buyers, Dazzan-Palmer said.
Residents in the gated community told the Los Angeles Times that a woman they believe was Cheronda Guyton took up occupancy at the home in May. Residents said they obtained Guyton’s name from the community’s guards, who had issued her a homeowner’s parking pass.
Residents also wrote down the license plate number of a 2007 Volvo sport-utility vehicle they say was parked in the home’s garage. A check of state motor vehicle license plates by the Times found the vehicle was registered to Guyton.
Guyton is a Wells Fargo senior vice president responsible for foreclosed commercial properties, resident Phillip Roman said.
“It’s outrageous to take over a property like that, not make it available and then put someone from the bank in it,” said Roman, who lives a few homes away from the property.
Residents said Guyton, along with her husband and two children, often hosted guests at the home, including a large party the last weekend of August. Malibu Colony is about 25 miles from downtown Los Angeles.
Wells Fargo said in a written statement that it would conduct a thorough investigation of the allegations by neighbors, but said it wouldn’t “discuss specific team member situations/issues for privacy reasons.”
Guyton’s home number is unlisted, and attempts to reach her at her Los Angeles office after work hours were unsuccessful.
The bank’s agreement with the prior owner required it to keep the home — a 3,800-square-foot, two-story structure built in the early 1990s — off the market for a period of time, Wells Fargo said in the statement. The bank said it planned to list the property for sale soon.
Too Good to Be True –
Arvedlund’s In-Depth Look at Madoff
to Be True: The Rise and Fall of Bernie Madoff by Erin
Buy new: $17.13 / Used from:
Usually ships in 24 hours
Good to Be True” is a new book by Erin Arvedlund which chronicles
the catastrophic fraud committed by Bernard Madoff over the last
Arvedlund wrote a Barron’s article
back in 2001 called “Don’t
Ask, Don’t Tell” questioning the magical returns of Madoff’s
so-called “hedge fund,” which is now widely accepted to have been the
largest, most outrageous, most ginormously craptastic,
how-do-I-express-without-cursing Ponzi scheme in history.
article in Barron’s, based on more than one hundred interviews, could
have prevented a lot of misery, had the SEC followed up,” boasts the
jacket of her new book “Too Good to be True,” which was released August
I didn’t know what to make of the book at first; it seemed to
read somewhat Biblically — a lot of begetting (who Madoff knew, how he
knew them, etc.) and not a lot of action. For the first 100 pages or so
I kept thinking “Arvedlund had better sex this up,” especially
considering the number of other books on Madoff, including the highly
Other Secret: Love, Money, Bernie, and Me” by his mistress, Sheryl
Weinstein, released August 25.
Well, if money is your porn, you
won’t get through this book without removing an article of clothing.
book slowly becomes a whodunit, naming both names and numbers and
ultimately presenting the unsatisfying fact that Madoff got away with
one of the oldest tricks in the book — the same trick relied upon by
everyone from white collar criminals to wedding crashers and underage
drinkers — he pretended nothing was wrong, and so nobody asked him any
As the story picks up, it becomes the heroic tale of
Harry Markopolos, whom Arvedlund wisely and perhaps correctly dubs an
Everyman; “a straightforward American guy who liked numbers.” This man
practically gift-wrapped red flags and hand-delivered them to the SEC
for a decade preceding Bernard Madoff’s arrest. Reading, I felt a
discouragement with our country’s level of corruption I haven’t felt
since I watched Michael Moore’s damning portrait of war and the oil
9/11.” The SEC was created during the Great Depression to regulate
our financial industry, but, according to Arvedlund, it’s being run by a
bunch of early-career lawyers who don’t want to step on anyone’s toes
— and who were getting their financial advice from Uncle Bernie
The book has no mercy on Madoff — there is no point at
which we are expected to believe in him. It simply relays the facts like
an obituary; one which gets juicier and juicier as it exposes the
cyclone of fraud which took place. It was executed in such simple and
easily understandable ways — virtually the whole scheme seems to have
relied upon Madoff’s refusal to upgrade an archaic computer system which
required one to enter stock price data manually. “Entering the data by
hand [Robert] MacMahon noted, meant that the person doing it could put
in whatever they wanted,” writes Arvedlund. As you probably already
know, Bernie found himself in the business of making up numbers. The
book purports that he created monthly statements by going back over the
last month’s market and seeing what he would have had to trade to make
the profit he claimed to have made (which I’m guessing someone else
probably did for him while he was in France, buying his third boat).
book recounts the aftermath well; the suicides, the testimonials in
court (left me wanting more), and delicately suggests other individuals
who could be to blame; for example Michael Bienes, who did a lot of
recruiting for Madoff — a pointed final statement in the section about
him says “At the time of this writing, no one has sued Bienes over his
ties to Madoff.”
“Too Good to Be True” will appeal to both the
savvier members of the financial community who knew (or should have
known) better than to trust Madoff, and to the underdogs and
mom-and-pops who were (or might have been) swindled. The lesson is
clear: no one should be so well-respected that they don’t have to answer
questions, and if everyone pretends they understand something they
don’t so as to appear sophisticated, or they accept being kept in the
dark about the means so long as the ends are 10-20+ percent, villains
like Madoff will always be able to take advantage of that pride and
greed — not to say that his victims were guilty of either; it’s the
feeder funds and his recruiters at whom we should all be looking. And,
of course, probably his family and everyone else who worked alongside
his IBM AS/400.
In these economic times, most of us have had a
taste of what it’s like to lose money, and it’s easy to identify with
Madoff’s victims. I found myself choked up at the end of the book — not
because the damages will perhaps never be repaid, not because our
country seems to constantly wager the well-being of its citizens (I’m
speaking of the SEC dot gov’s alleged shameless favoritism), but because
although he was one of the most well-connected, powerful, and
untouchable figures in the world, they got him. It took the collapse of
the financial market, but they finally, finally got him.