Tag Archives: Fairfield Greenwich Group

Where’s Walter?

Walter’s Playhouse

The media has lost track of Walter Noel this summer and I can’t find him. Is he summering in Southampton? Anyone know?

And can you figure out how he’s allowed to stay in his beach cottage (last rented out, summer of 2009, for $375,000 per month) when he’s on the hook for a couple of billions of dollars? And how, four years on, is he still free?

Just asking.


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Walter Noel is still on the hook

Madoff Trustee, Fairfield Group liquidator agree on settlement. That might at first blush sound like good news for our Round Hill resident but then there’s this:

The settlement allows the liquidators of the Fairfield funds to work together with Picard to purse [sic] assets from the former owners and managers of the Fairfield funds, David Sheehan, the Madoff trustee’s chief counsel, said in Picard’s statement.

I think Walt’s going to have a troubled retirement.


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No wonder Monica Noel is away

Reader IL sends along this arbitration award: $1.8 million against a Madoff feeder fund. Not Walter’s and his Fairfield Greenwich Group, but same cause of action, same facts. The old homestead on Round Hill Road draws closer to the auction block.

May 17 (Bloomberg) — An investor in J. Ezra Merkin’s Ascot Partners LP, a feeder fund for Ponzi schemer Bernard Madoff, was awarded $1.75 million by arbitrators who found Merkin intentionally breached his fiduciary duty by not disclosing Madoff’s role in the fund, according to a court filing.

Merkin also was negligent in performing due diligence on Madoff, a majority of an arbitration panel found, according to a petition filed today in New York state court. Investor Noel Wiederhorn, who put $1.46 million into Ascot Partners in 2003 and 2004, is seeking a judgment confirming the award, which was for the amount he invested plus interest.

Wiederhorn, a Wycoff, New Jersey, pediatrician, also asked that the sealed record of the arbitration case be made public.

“These findings could have significance in later litigation and arbitrations against Mr. Merkin as well as against numerous other Madoff feeder-fund managers,” Weiderhorn’s attorney, David Bamberger, wrote in asking for the record to be unsealed.

The evidence showed “major contradictions and ambiguities” in transaction confirmations, which should have caused Merkin to question the Madoff trades, according to his filing. The evidence in the hearing also established the “extreme improbability” of the transactions Madoff reported in the over-the-counter options market, the papers said.

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Andres is stuck on his yacht now

Fairfield Greenwich Group shuts its office in Spain.


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Learning from other’s experience

When Bernie Madoff went down last December 11th his largest co-conspirator, Fairfield Greenwich Group, kept its website up for days, allowing ghouls like me to capture images of its promises of due diligence. That will prove a mistake in the years of litigation FGG now faces.

Galleon Group will not repeat Walt Noel’s mistake, as Business Insider discovered when its editor attempted to access their page and got this: (Bess Levin suggests that they’ve taken down the page pursuant to a really cool re-do, but I think she’s being funny)



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Walter’s woes just never end

Bernie Madoff may be preparing to shuffle off this mortal coil but Walter Noel is still golfing in the Hamptons, resting up, no doubt, for his hearings in Boston that commence September 9th. But now comes news that investors who lost money with Bernie are suing the feeder funds that fed Walter and Fairfield Greenwich Group who in turn fed Madoff. The first out of the box is a suit against something called Chartered Investments (or something like that).  The first thing someone like Chartered will do in a situation like this is to implead – sue – Fairfield, saying, in effect, “if we’re responsible for our clients’ losses, then you’re really to blame, because we relied on your due diligence, which you didn’t perform.” I don’t know if this will add to the $7.5 billion FGG admits it lost to Madoff, but it’s certainly going to add to its legal fees. I wonder whether Andres has found a buyer for that yacht yet?


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Someone’s picking on Walt Noel

A reader sent me this link to a WSJ article which I missed in all the excitement of setting up my new business venture (below). Massachusetts’s AG rejected an offer from FGG to compensate all that state’s victims for every penny they lost. The AG claims his state’s residents lost $6 milion with FGG, FGG said “okay, here: take it back”. Not sufficient. The AG wants more discovery and, prossibly, this being a position held by politically ambitious persons (see Blumenthal, Richard, eg), a show trial. Hmmm. More fun scheduled for September 9th.


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The noose tightens, the net spreads wider, whatever

JP Morgan is in the sights of the Get Madoff crowd. While the bank had a small amount ($250 million) of its own money in the game, it pulled it in September after a summer of rumors about Bernie. JP forgot to tell its clients, though, and they were left high and dry. Sort of like Walt Noel and his Fairfield Greenwich Group, but I believe they’re already named in this suit. Should continue to get interesting as this latest inclusion of a defendant is the result of the 4 1/2 hours Bernie spent talking with the lead litigator. Nervous yet, Walt?

By the way, why is the New York Post on top of the Madoff story while the New York Times and the Wall Street Journal ignore it? Just because a story is sexy and has legs is no reason to leave the field to the Post, is it?


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Who’d a thunk it? Walt Noel suspected Madoff was a crook!

A September 9th hearing up in Boston will be devoted to what Walter Noel and his boys knew and when they knew it. I’m going to check – if the hearing is open to the public, I smell road trip. How cool to live-blog from there! Walt, if you’re going (and I assume that you are since you’ve been subpoenaed) maybe we can ride up together. I’ll borrow a trailer and the filly(ie)’s can come too.

Boston Globe, Beth Healy

The Massachusetts memo portrays Fairfield Greenwich as growing more aware over the course of 2008 of gaps in its knowledge of Madoff’s operations. Executives acknowledged to state regulators and to each other in internal e-mails that they couldn’t answer the increasingly probing questions of some clients. They didn’t know Madoff’s trading strategy, they knew only a handful of Madoff’s employees, and had never been allowed to see the trading floor where Madoff was allegedly buying and selling securities for their customers.


By last year, Fairfield was feeling far more pressure. In May 2008, a large European investment client, Unigestion, asked if Madoffreally made the trades he claimed, the state said. Dissatisfied with Fairfield’s assurances, Unigestion withdrew $75 million by August.

In one e-mail to his colleagues on Aug. 20, 2008, [FGG employee] Vijayvergiyasaid he had reassured a customer that after two decades of dealing with Madoff’s firm, “we have good knowledge of BLM’s business,’’ according to text of the e-mail cited in Galvin’s memo.

Yet just the day before, Vijayvergiya wrote in another internal e-mail that “unfortunately there are certain aspects of BLM’s operations that remain unclear and although we are attempting to obtain responses from Bernie Madoff . . . this process could take some time.’’

That same month, another big customer, JPMorgan, asked about the trading counterparties in Madoff’s options-investment strategy; when Fairfield couldn’t answer, the Wall Street giant withdrew its money.

Though they could not answer clients’ specific questions, Fairfield Greenwich executives drummed up a stock reply to respond to them. According to the memorandum, a Nov. 14 e-mail by a Fairfield analyst laid out a “standard response’’ for clients, “setting forth the basis on which Fairfield was satisfied that adequate controls existed to ensure that the Madoff assets were properly supervised.’’

While FWIW was unable to reach FGG spokesman Seth Faison for comment (not that we tried) Edgar Martins, as usual, spoke for him: “It’s all a bunch of horrible lies,” Martins insisted on behalf of Faison. “Horrible! My clients were busy as little beavers, keeping track of their profits and Andres’ whereabouts – do you have any idea how hard it is to keep track of a drunken skipper on a boat that goes 39 knots and has the seven seas to get lost in? – that they couldn’t possibly be expected to watch their old friend Bernie. The man was the fucking head of the fucking NASD, for Crissake! You think Walter’s gonna call him a crook? Lose a zillion bucks in fees? Go pound sand.”

Here’s the original complaint brought against FGG


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Andres Piedrahita: We’re so sorry, we’ll give it all back!

So he says now. Walt Noel, however, has already emailed us to say that his dumb son-in-law is high on horse flatulence and no money is going to be returned, ever. I’ll bet Walt is right on this, and that Andres was put up to this egregious lie by Fairfield Greenwich Group’s PR guy, Seth Faison.


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Uh oh, Walt’s sicced the dogs on me!

Received the following email from some Fairfield Greenwich Group PR guy. I’ll call him after lunch and report back but it sounds like fun. Oe question: where is FGG getting the money to pay a PR firm?

I just left you voicemail. I’m a media adviser to Fairfield Greenwich, and some comments that were posted to an item on your blog have raised concern. I hope there’s an easy way to resolve it. Please give me a call at [                               ] , when you have a moment.
Seth Faison

UPDATE: I spoke with Mr. Faison, who turned out to be very polite and had a simple request: someone commenting on an unrelated blog posting here several  months ago had put up the name, address and telephone number of a person vaguely related to FGG and would I consider taking it down off the Internet? Of course I would do that and have done so. I try to weed out that stuff before it gets posted because it can lead to real abuse of people, but this one slipped by. So now it’s gone, end of matter. How dull.

I did express my surprise to Mr. Faison that FGG was still around to pay a PR firm and he told me that “there are a lot of law suits out there”  who knew? And Faison’s firm is working on putting out fires. Interesting.



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Won’t some Colombian investor please have a talk with Andres?

While poor Walter Noel is stuck cadging free drinks at the Bathing Club in the Hamptons (where he was blackballed from membership, but can still walk the hallowed grounds if accompanied by a member) and is banned from his digs at the Round Hill Club, son-in-law Andres Piedrahita is busy living it up on stolen money. Turns out, he’s off cruising the high seas on his new $30 million yacht he bought this June. That’s not just showing no remorse, that’s rubbing defrauded investors’ noses in it. Could be dangerous, Andres.

"Two mojitos, Walter and then I believe the master stateroom's head needs attending to."

"Two mojitos, Walter and then I believe the master stateroom's head needs attending to."

Greetings from Bogata!

Greetings from Bogata!


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You call this justice?

Walter Noel returns from BVI wearing nothing but an all-over tan. All the poor bastard wanted was to get away from Mustique for a little R&R!

A judge in the British Virgin Islands has approved the liquidation of the Fairfield Sentry funds, which were the largest conduits for cash flowing into the hands of Bernard L. Madoff and his global Ponzi scheme.

The ruling on Tuesday cleared the way for the fund’s investors to pursue legal claims against the Fairfield Greenwich Group and its affiliates, which advised and marketed the funds worldwide.

When Mr. Madoff was arrested in December, the Sentry funds, regarded as one of the so-called feeder funds, had more than $7.2 billion invested in his spurious investment advisory operation. He has since pleaded guilty and is serving a 150-year jail term.

According to the court application in Road Town, Tortola, the capital of the British Virgin Islands, the funds now have less than $70 million, all of it subject to ownership disputes and most of it frozen by a court in the Netherlands. Fairfield Greenwich Group did not immediately respond to requests for comment.

Although Fairfield Greenwich is based in New York, its flagship funds were incorporated in 1990 under the mutual fund statutes of the British Virgin Islands and technically are under the control of local directors there.

This year, lawyers acting for Boies, Schiller & Flexner, a law firm representing investors, sought the liquidation of the funds, arguing that management had been “effectively paralyzed and its business destroyed.” Their actions have left no potential assets except legal claims against others including the fund’s directors and management, the lawyers argued.

Many others are pursuing claims against the Fairfield Greenwich Group, its partners or its offshore affiliates.

Besides lawsuits by individual investors, the group has also been sued by Irving H. Picard, the trustee liquidating Mr. Madoff’s brokerage business for the benefit of his victims. If Mr. Picard’s lawsuit is successful, he would become one of the fund’s unsecured creditors in the liquidation proceeding in the British Virgin Islands.


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There can be no rational market while Walter Noel’s on the loose

General Motors stock, destined to become worthless as the result of its bankruptcy, gained 43% today before trading was halted at 2:00 p.m. Experts profess bewilderment at the phenomenon (which actually happens all the time down there in the canyons) but as one pointed out, “someone’s making a lot of money on this.” It’s cruel to say so after he’s become such a friend of this blog but I did mention last week that Noel’s Fairfield Greenwich Group restarted operations last week, ostensibly to wind up its matters. Is it too far a stretch to imagine Walt having one more go at his Round Hill Club friends at the bar, offering them a “sure fire, can’t miss” investment opportunity?


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Madoff feeder funds subject to criminal investigation

With Bernie put away for good and Ruthie out on the street (without her fur coat) prosecutors are turning their attention to the feeder funds that made so much off of Bernie while their clients earned so little. Today it’s former penny-stock fraudster Sonja Kohn and her Austrian operation with the deceiving name of Bank Medici (Kohn is no Medici and barely a banker), but the allegations: $20 million payments for “research” and still more payments for funneling investors into the Madoff maw  sounds like what might turn up during an investigation of Fairfield Greenwich Group. I have every hope that that investigation is proceeding as I write this.

As for the remnants of the Madoff family, a source tells me that he spoke with one of the boys and the two of them are convinced their lives are over and they’re facing a life of destitution. For what it’s worth, this source believes the boys were just doofs who play acted at running Daddy’s business and never learned or even questioned how it was that they could get so rich when their company turned no profits. Oh well, that’s too bad, but I’ll reserve my sympathy for more deserving victims.

Here’s what prosecutors are looking at in Austria:

U.S., U.K. and Austrian prosecutors are investigating a former Austrian fund manager they believe was paid more than $40 million in kickbacks to funnel billions of dollars of investments to Bernard Madoff.

Prosecutors from all three investigations believe Mr. Madoff paid kickbacks to Sonja Kohn while she was chairwoman of Austria’s Bank Medici AG via separate companies she controlled, according to affidavits detailing the investigations and hundreds of documents collected by Austrian prosecutors that were reviewed by The Wall Street Journal.

In exchange for the kickbacks, prosecutors allege, Ms. Kohn turned three Bank Medici funds into “feeder funds” that supplied Mr. Madoff with an estimated $3.5 billion from European investors
The three investigations, which are separate and at an early stage, offer a picture of how Mr. Madoff may have persuaded fund managers abroad to find investors for Mr. Madoff. The investigations don’t claim that Ms. Kohn knew the nature of Mr. Madoff’s $65 billion Ponzi scheme.

“I am actually the greatest Madoff victim. It is a tragedy for my family, my company and for me personally,” Ms. Kohn said by phone on Wednesday. She declined to discuss details of the allegations against her.

Ms. Kohn, a 60-year-old Viennese former Wall Street penny-stock broker, has repeatedly denied prior knowledge of Mr. Madoff’s $65 billion fraud or any wrongdoing. A judge sentenced Mr. Madoff to 150 years in prison on Monday.

According to an April affidavit from the Justice Department filed with Vienna prosecutors, Ms. Kohn is under investigation in the U.S. for potential criminal charges of conspiracy, fraud and wire fraud in connection with the alleged kickbacks.

Regulators have filed civil, but not criminal, charges against several fund managers who steered their clients’ money to the Madoff firm.

Two streams of alleged payments are under investigation. Early this year, U.S. investigators noticed a flow of payments totaling about $32 million over 10 years from Mr. Madoff’s advisory firm, Bernard L. Madoff Investment Securities LLC, to Infovaleur Inc., a New York company that was “owned by Sonja Kohn personally,” according to a U.S. affidavit filed on April 6.

The U.S. affidavit said U.S. prosecutors were unable to locate a registration for Infovaleur Inc.

“It does not appear that Kohn, or Bank Medici, ever disclosed to investors in the feeder fund that Kohn was personally receiving payments from Madoff at the same time as she was investing the feeder funds with [Mr. Madoff’s fund],” the affidavit says. Mr. Madoff was “actually in full control” of Bank Medici’s investments, according to the affidavit.

Prospectuses for the Bank Medici funds that Ms. Kohn oversaw claimed they were investing in a basket of 35 to 50 Standard & Poor’s 100-stock index shares, as well as in U.S. Treasurys, the affidavit says.

The prospectuses didn’t mention Mr. Madoff or his company, when in fact all of the funds’ money was being forwarded to Mr. Madoff, the affidavits say.

Meanwhile, Grant Thornton U.K. LLP, the accounting firm liquidating Mr. Madoff’s London-based unit, Madoff Securities International Ltd., discovered a bank receipt that triggered a U.K. investigation, according to a March 24 affidavit filed with Austrian prosecutors by the Serious Fraud Office, a U.K. government agency responsible for prosecuting complex fraud cases.

The bank receipt referenced a check that Madoff International paid to a company called Erko Inc. and which was deposited in a Vienna bank account, according to the U.K. affidavit.

The affidavit said the Serious Fraud Office had determined that both Erko and the bank account were controlled by Ms. Kohn. The fraud office also said in the affidavit it was unable to locate a registration for Erko.

The U.K. affidavit alleges that Mr. Madoff’s London subsidiary paid about £7 million ($11.5 million) over five years to Erko. A British prosecutor alleges in the document that Mr. Madoff attempted to hide payments to Ms. Kohn by “falsely” declaring them in his company accounts as payment for research reports.

“It is suspected that the research papers were completely worthless and that the reports were never in fact used by [Madoff Securities International] for business decisions,” the affidavit said.

The Serious Fraud Office is investigating Ms. Kohn in connection with potential criminal charges of money laundering and falsifying documents to receive kickbacks, according to the affidavit.

U.S. prosecutors say Mr. Madoff depended on feeder funds run by investment advisers such as Ms. Kohn to recruit the large numbers of new investors needed to sustain the fraud.


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Walt, you sly dog, so that’s where you’ve been!

Fairfield Greenwich Group has reopened its New York offices. Nothing going on at 2 Sound Shore here in Greenwich, but anyone left with money for train fare is apparently back in the City, ready to do more harm.


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News from the Noel side of things

Tatiana Boncompagni, sister-in-law? former daughter-in-law? Some kind of relation to Walt Noel’s first partner in Fairfield Greenwichl Group (the one who “retired” years ago and kept cashing the checks generated by Bernie Madoff’s cheating) has written a distressing tale of the sorrows of hedge fund wives. The poor bastards have lost their money and at least one bitter wife confides to Tatiana, “I didn’t get married for this. Do you know I have to take the subway now?” Truly horrifying. If you have nerves of steel and a stone-cold heart, you might want to read it for an insight into how your neighbors are suffering.


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An interview with Walt

(ABC News)

(ABC News)

As I passed by 175 Round Hill Road yesterday I spied Walt Noel pushing a hand mower around the front yard. I stopped to greet him but when he saw who I was he looked stricken.

“Holy cow, Chris, if Monica sees you here – whoo boy! Let’s go over to the Club before she comes out.”

“I thought …” I said, but Walt quickly corrected me.

“That we were toast over there? Ha! You know how many Round Hill members can’t pay their dues these days? I’ve still got a pile of” – here he paused to make rabbit ears in the air – ” ‘investors’ money to spend and I’m doing it. They love me over there, at least until the annual meeting in September. Let’s go.”

Seated at the bar, Mojitos in hand, Walt began speaking.

“This is just such nonsense, Chris, I mean, we were the victims of a fraud so sophisticated that even the SEC couldn’t detect it. How were we supposed to know anything was wrong?”

“But what about conducting your own due diligence?” I asked.

“We did that,” he insisted. “We had a due diligencer – it was part of the Greenwich High School program where you take in a senior for the last month of the school year, you know? Every year, we’d bring a kid in, ask him to check out our investments, let us know if there was anything wrong. There never was.

“And we didn’t stop there, let me tell you. You know that we had over 120 people working at Fairfield Greenwich, right? Sure, most of them were salesmen, but we had a team that did nothing all day but scour Wall Street, looking for investment opportunities for our investors. Every day!”

“Yet you always ended up giving the money to Bernie,” I pointed out, “and never found a better or even a different investment.”

Walt took a long pull from his Mojito and signalled the bartender for another. Raising his famous caterpillar eyebrow (s?)  he said, “what other investment let us skim off 1% of the assets invested plus 20% of the profits?”

“So that was the best investment for you,” I conceded, “but best for your clients?”

“Clients?” Walt spluttered. “You think Jamie Cayne ran Bear Stearns for the benefit of clients? You think he bankrolled every penny stock boiler room in the country for the benefit of some granny in Peoria? What, she needed to lose her life savings and Bear Stearns was just accommodating her? Where’s Jamie now? Safe in retirement, playing bridge with Bill Gates. And Dickie Fuld – he ran Lehman for its clients? Funny how he got rich, they got diddly-doo, isn’t it? Where’s Hank Greenberg today? Not sweating in depositions like I am, let me tell you Chris. All those guys cleaned up and got out of Dodge while I’ve got these bloodsuckers crawling all over me, trying to bring me down. Life is just gosh-darn unfair.”

“But Walt,” I tried again, “what exactly did you do for all that money you were pulling in? Hundreds of millions of dollars in fees?”

“We kept up appearances,” Walt said, “made people feel happy and secure. They’d come visit us in the City – you ever see that place? I could have used veneer – Andres begged me to, but no, I insisted on solid mahogany; that’s full quarter – inch wood on those walls, and genuine marble in the bathrooms. Top of the line computer stuff too. We replaced it every year. We didn’t need to – never used it – but it gave the clients confidence. We gave them a happy two decades, Chris; every month they’d get a nice statement, printed on expensive bond paper, telling them they were richer than they’d been thirty days before. That kind of peace of mind? Priceless. No, we earned our money alright, every penny of it.”

“Are you at all sorry that you’ve ruined your friends? That they’re penniless?

“Well of course I am. This threatens to ruin me too, or it would if I hadn’t worked with Andy and Mark to stash things away.”

“Andy and Mark Madoff?” I asked.

“Yeah. Remember the last weeks in December, after Bernie had been caught but before Picard, that son-of-a-gun, confiscated the jet? The boys flew all over the world, and I went with them. Almost missed the club’s Christmas party because of it – that was close. Boy, Monica would have been mad then, let me tell – ”

“So you won’t get harmed by all this?” I interrupted.

“Sure I will, and I’m very disappointed. The cottage has to go – say, you’re a realtor, what can I get for it?”

“Fire sale price” I said, “maybe three and a half.”

Walt shook his head. “Too little. I may have to talk to Ric Bourke – he’s got some deal going on with his own place, wants to get rid of it before his own trial ends – maybe his buyer will want my cottage for guests.

“But anyway,” he continued, “sure I’ve been hurt. Round Hill’s going, I don’t even want the Hamptons place anymore – between Bernie’s investors and mine, the beach might as well have sand fleas; one of the girls, I forget which one, has to sell off her Brownstone, and Mustique …. well my lawyer told me they have an extradition treaty with the U.S. I understand North Korea’s okay, but their winters are just horrible. So ….”

He glanced at his Rolex. “Holy cow, I’ve got to get back before Monica finds out I’m missing. She worries about me, you know.” He winked. “If even she thinks I’ve got Alzheimer’s, how’s anyone else to know different?”

“Anything you want to say to your clients, Walt?” I asked as we strolled back across Round Hill Road.

He paused in the road, forcing a pick-up truck filled with Colombian gunmen to swerve around us. “I told Andres not to crap in his own backyard,” Walt said, watching the truck disappear up the road. “I wish him luck, wherever he’s got himself to.” He turned to me at the entrance to his driveway, raised his finger skyward and said,  “I’d tell them this: you had twenty good years with me, and then we all hit a little rough patch for a couple of months. All in all, is that so bad?”

I left him trying to start his mower and I didn’t have the heart to point out to him that it lacked an engine. In the background, I could hear Monica yelling for the Fabulous Five to exit the pool and come back to the house to finish packing.



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Okay, this isn’t funny! Well, perhaps a little

I thought Original Walt was directing me to a parody site when he sent me this link, but it’s true:Fairfield Greenwich Group is suing Fairfield Sentry (or the other way around – who cares?) for failing to detect Madoff’s scam.

blazing saddles cleavon little sheriff
Hold it
[the Johnsons load their guns and point them at Bart. Bart then points his own pistol at his head]
Bart: [low voice] Hold it! Next man makes a move, the nigger gets it!
Olson Johnson: Hold it, men. He’s not bluffing.
Dr. Sam Johnson: Listen to him, men. He’s just crazy enough to do it!
Bart: [low voice] Drop it! Or I swear I’ll blow this nigger’s head all over this town!
Bart: [high-pitched voice] Oh, lo’dy, lo’d, he’s desp’it! Do what he say, do what he say!
[Townspeople drop their guns. Bart jams the gun into his neck and drags himself through the crowd towards the station]
Harriet Johnson: Isn’t anybody going to help that poor man?
Dr. Sam Johnson: Hush, Harriet! That’s a sure way to get him killed!
Bart: [high-pitched voice] Oooh! He’p me, he’p me! Somebody he’p me! He’p me! He’p me! He’p me!
Bart: [low voice] Shut up!
[Bart places his hand over his own mouth, then drags himself through the door into his office]
Bart: Ooh, baby, you are so talented!
[looks into the camera]
Bart: And they are so *dumb*!



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That settles that

As (the original) Fake Walt points out below, Frontline’s story on Bernie Madoff and Fairfield Greenwich Group’s involvement in the fraud was entirely inaccurate and false, in so far as it related to FGG’s participation, so, according to this press release, we should all give up and go home, after issuing a nice apology to Walt. If they say so it must be true, so apology duly noted. I remain just a tad skeptical, though, and I’m not entirely convinced that this bit is going to take FGG completely off the hook:

The Frontline program contained several other stark errors, as well. For example:

  1. Frontline inaccurately portrayed a December 2005 call between Madoff and FGG personnel, in preparation for an interview with the SEC. Frontline failed to disclose that, prior to the call, FGG had requested permission from the SEC to speak with Madoff, and that FGG people discussed the Madoff call with the SEC afterward. Most important, records clearly show that FGG personnel responded truthfully to all of the SEC’s questions.
  2. Frontline erroneously portrayed an on-site visit to Madoff’s office by FGG executive Jeffrey Tucker, implying thatTucker never received verification of Madoff’s trading. In fact, Tucker was shown an electronic screen with DTC records of Fairfield client trades.
  3. Frontline erroneously reported that FGG’s due diligence operation was located solely in Bermuda. In fact, as Frontline producers were informed, FGG professionals actively monitored the investment with Madoff and conducted due diligence both in Bermuda and at the firm’s New York headquarters.

Look: Ican certainly understand how a genuine “electronic screen” could fool even a trained investor – happens to me all the time – why, just last fall, I saw a Patriot fumble on the five yard line and I tried to pick up the ball through my plasma screen and run it in for a touchdown. Boy, was my face ever red! But I wonder whether the defrauded investors will be so understanding. They should be, of course, but sometimes, when $7.5 billion is lost, people just aren’t as kind as they otherwise might be.


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