No One Would Listen: A True Financial Thriller by Harry Markopolos (rainbow fish read aloud .txt) 📗

My informer inside the SEC had been absolutely correct: The agency was trying to cover up its malfeasance. I had to wonder how far the SEC would go to protect itself.

Within a day of Madoff’s surrender, my house was under media siege. Cameras were set up on my front lawn and it seemed like every TV producer in the business had my phone numbers on speed dial. My phone never stopped ringing. I had to come up with a plan, so I decided I’d speak to the Journal for print, make one big TV appearance, and do one radio show.

Meanwhile, Zuckerman and I were working 16 to 20 hours a day, desperately trying to get the story published as quickly as possible. I was living on adrenaline; I couldn’t sleep. I knew I wasn’t going to be vindicated until the story was published. I’d sleep then. I kept feeding him more and more documents, whatever he said he needed. Finally, he asked me, “Are you for real? I mean, are you making this stuff up?” Later I found out that he actually called Frank and Neil to confirm my story.

“You’re kidding me, right, Greg?” I said. “How could anybody write all this stuff on short notice and in such great detail?”

“I know that,” he admitted. “No one could. But this stuff you’re sending me—it’s too good to be true. It’s amazing. You knew all of this was going on?”

“Yes, I did.”

“Jeez,” he said, impressed. I could hear the astonishment in his voice as the full impact of this information hit him. This was proof that the SEC had been warned about Madoff eight years earlier and had done nothing to stop him. They were $50 billion too late. “Jeez,” he said again.

Later that evening John Wilke finally called me. I knew he was excited about the story, but from the sound of his voice it was obvious that the chemo was draining all his energy. There was an overwhelming sadness in this conversation; this should have been another scoop for Front Page Wilke, but physically he couldn’t write it. He did call Zuckerman, though, and gave me great reviews. “He’s totally legit,” he told Zuckerman, and then admitted, “We’ve had all this information for a couple of years.”

What continued to astonish me was the SEC’s denial that I existed. It was obvious they were desperately trying to contain the damage and were hoping that somehow I wouldn’t surface. I was the smoking gun that could destroy that agency. And as long as they were able to maintain the fiction that there was no whistleblower and they knew nothing about Madoff, I believed I was still in jeopardy.

Finally, five days after Madoff’s surrender, Zuckerman called the SEC’s Washington office and asked specifically, “On April 2, 2008, did your director of risk management, Jonathan Sokobin, get the following e-mail with the subject line, ‘$30 Billion Equity Derivative Hedge Fund Fraud in New York’?”

That was the first time the SEC knew that the Wall Street Journal had copies of my submissions. They were finished. That night SEC Chairman Christopher Cox issued a long statement in which he reviewed the progress the agency was making in closing the biggest barn door in Wall Street history. Basically, he began with several excuses, claiming that Madoff took “complicated steps . . . to deceive investors, the public and regulators,” and that he “kept several sets of books and false documents, and provided false information.”

It was only in the third paragraph that he finally admitted, “The Commission has learned that credible and specific allegations regarding Mr. Madoff’s financial wrongdoing, going back to at least 1999, were repeatedly brought to the attention of the SEC staff, but were never recommended to the Commission for action. I am gravely concerned by the apparent multiple failures over at least a decade to thoroughly investigate these allegations....

“In response . . . I have directed a full and immediate review of the past allegations regarding Mr. Madoff and his firm and the reasons they were not found credible, to be led by the SEC’s Inspector General. The review will also cover the internal policies at the SEC . . . and whether improvements to those policies are necessary.”

Basically, he threw his staff under the bus. I’d won.

Once the SEC issued its mea culpa acknowledging my existence, the editors at the Wall Street Journal told Greg Zuckerman that his story was not going to be published as scheduled. They had decided to double the size of the article, add pictures, and move it to the top slot as the page one cover story for the following day’s edition. Greg called me excitedly and asked me if I minded the delay in order to appear on the front cover. I said, “No, but only if you agree to post my 2005 SEC submission on your web site so that the world knows exactly what information the SEC had and failed to act on.” He readily agreed, and we started working overtime to get the story written.

I think we were both too excited to sleep well that night. I knew that this story was going to rock the SEC’s world with earthquake-like force. Once that story was out and my SEC submissions, along with a few e-mails, were posted online, my family and I would have nothing to fear from the SEC ever again.

Greg and I worked feverishly through the next day. Late the following afternoon the Journal posted the one-star edition onto its online edition, which we both read. He kept writing, adding more and more detail until finally late that evening the five-star late edition made its way onto the web site and out to printing presses. My wife came up to my office and accused me of being Greg Zuckerman’s unpaid love slave, to which I replied, “Well, I am Greek and I bet he’s probably very cute in person.” She laughed and went to bed.

On Thursday, December 18, the