LATEST MADOFF NEWS

COURT FILINGS

  • Net Equity
  • Customer Issue
  • Trustee Reports
  • ============================

    BLOG ISSUES SPOTLIGHT ARCHIVES

    Click Here for NIAP Blog Archives

    Click Here for Madoff-Help Blog Archives

    SIPC’s Brokerage Account ‘Insurance’ Scam: Take It from a Comptroller of the Currency

    SIPC’s Brokerage Account ‘Insurance’ Scam: Take It from a Comptroller of the Currency

    I’ve invited James Smith, former Comptroller of the Currency and former Deputy Under-Secretary of the U.S. Treasury to discuss the Insurance Scam being run by SIPC. As I’ve discussed in prior columns posted at www.kotlikoff.net, this scam puts all brokerage account holders at extreme risk. Indeed, I strongly recommend every brokerage account holder close her account immediately pending passage of H.R. 3482 and S. 1725. I also strongly recommend that all SIPC-insured brokerage firms immediately disclose the huge risk to their clients of SIPC “insurance,” specifically that if they withdraw and spend enough of their account balances, they can a) lose any claim to SIPC insurance coverage on their remaining balance and b) also be sued for every penny they legitimately withdrew over the six years proceeding the discovery of fraud in their brokerage account. To avoid its insurance obligation and sue legitimate brokerage account investors, SIPC need only declare the fraud a Ponzi Scheme, which is easily done and which, as the NY Times, recently reported, are a dime a dozen.

    Take It From a Comptroller of the Currency:

    Congress Needs to Act Now to Protect Investors from SIPC “Insurance”

    by James E. Smith

    On September 25, 2000, eight years before the scams of Bernard Madoff and R. Allen Stanford were uncovered, Gretchen Morgenson (financial journalist for the New York Times) wrote a perceptive column of exacting detail describing the Securities Investor Protection Corporation’s pinched and adversarial practices aimed at favoring the SIPC Fund over protecting innocent customers of failed broker dealers. That column was “dead on” concerning SIPC’s regrettable culture, in which litigation rather than protection is too often the order of the day.

    SourcedFrom Sourced from: Network For Investor Action & Protection

    Print This Post

    Kotlikoff: Investors at Risk of Wipeout, SIPC a Fraud

    Economist Laurence Kotlikoff is calling on all Americans to close their brokerage accounts immediately because of the risk of a total wipeout — a risk he says stems from a massive Wall Street insurance scam perpetrated by the Securities Investor Protection Corp. (SIPC). “SIPC, a brokerage ‘insurance’ arm of Wall Street, has been and remains today engaged in insurance fraud,” Kotlikoff told ThinkAdvisor in a telephone interview. “SIPC claims to insure brokerage accounts. Nothing could be farther from the truth. What it’s really doing is placing all brokerage account holders at extreme risk.” More on ThinkAdvisor here.

    SourcedFrom Sourced from: Network For Investor Action & Protection

    Print This Post

    Kotlikoff: Investors at Risk of Wipeout, SIPC a Fraud

    Economist Laurence Kotlikoff is calling on all Americans to close their brokerage accounts immediately because of the risk of a total wipeout — a risk he says stems from a massive Wall Street insurance scam perpetrated by the Securities Investor Protection Corp. (SIPC). “SIPC, a brokerage ‘insurance’ arm of Wall Street, has been and remains today engaged in insurance fraud,” Kotlikoff told ThinkAdvisor in a telephone interview. “SIPC claims to insure brokerage accounts. Nothing could be farther from the truth. What it’s really doing is placing all brokerage account holders at extreme risk.” More on Think Advisor here.

    SourcedFrom Sourced from: Network For Investor Action & Protection

    Print This Post

    ALERT:

    Vitter: Appeal for Stanford Ponzi Scheme Victim Fails, Highlights Need to Reform SIPC
    Click here for Senator Vitter’s statement following the July 18th Appeals Court Ruling in the SEC vs SIPC appeal for Stanford Ponzi Scheme Victims. Click here for a copy of the ruling.

    SourcedFrom Sourced from: Network For Investor Action & Protection

    Print This Post

    Stanford Losses Not Covered by SIPC, Appeals Court Rules

    The U.S. Securities and Exchange Commission can’t force a brokerage account insurer to pay victims of R. Allen Stanford’s $7 billion fraud because their purchases weren’t covered, an appeals court ruled. The U.S. Court of Appeals in Washington said the 7,000 investors in certificates of deposit sold by Stanford didn’t qualify as customers of a brokerage who would be insured by the Securities Investor Protection Corp., as the SEC argued. The CDs were bought at Antigua-based Stanford International Bank LLC, which wasn’t a SIPC member, the court said. The Stanford case is the first in which the SEC has gone to court to force SIPC to extend coverage. SIPC, a nonprofit corporation funded by the brokerage industry, has come under criticism from U.S. senators for allegedly favoring its Wall Street members over fraud victims in recent years. More on Bloomberg here.

    SourcedFrom Sourced from: Network For Investor Action & Protection

    Print This Post