HSBC shanghai'd in Bernie Madoff fraud

Madoff with their money!

Banking is a murky world. HSBC started off life in the city streets of both Hong Kong and Shanghai. It may be a case of "you can take the bank out of Shanghai but you can't take Shanghai out of the bank". I don't know about that. What I do know is that I read in the Daily Mail that HSBC is being sued for £5.7billion for its role in the massive fraud by Wall Street swindler Bernie Madoff. HSBC is accused of creating and maintaining an international network of a dozen feeder funds based in Europe, the Caribbean and Central America that provided the money to help finance Madoff's 'Ponzi' sheme.

HSBC vigoruosly denies the accusations against it. However, what concerns me is that the vast bonuses paid out to bankers in London must have been as a result of creating feeder funds, if not these particular ones. The more that so-called investment banking is put under the microscope the more one finds a lot of things crawling about. Surely we need transparency? Or am I totally naive?

It is claimed that the bank was advised at least twice that there were irregularities. KPMG identified 25 'fraud and operational risks' in 2006 and 28 risks in 2008, according to copies of reports obtained by Bloomberg. HSBC says it 'did not know a fraud was being committed and lost $1bn of its own assets as a victim'. Well, someone isn't being straight.

The one good thing about the internet is that this sort of activity can be exposed for further scrutiny. Piercing scrutiny is the only thing that reveals the truth these days. HSBC is either a victim or it is something else. Either way, it has not been, in this case, very diligent and it begs the question whether those in charge are worth their vast largesse.

Read more: http://www.dailymail.co.uk/news/article-1336360/HSBC-sued-5-7bn-failure-spot-Bernie-Madoff-fraud.html#ixzz1H3CxrBM2

Quantitative easing back for more cash!

Printing money is old hat. Quantitative easing is the new kid on the block. Actually a spotty teenager by now. The Monetary Policy Committee is chewing over whether to "pump more money" into the system. Who is being consulted on all this? Bernie Madoff in his jail cell?

I'd like to know, if this new QE idea gets the nod, which computer button gets pushed and from where does the "pumping" start? BP doesn't bother with empty wells so is the MPC any different?

Commenting on this Guardian article, Snix says -

"How much longer will this giant ponzi scheme go on for ? Who will decide to revert to the gold standard first? Those left holding worthless currencies will look so foolish. Better go and tend my garden."

Giant ponzi scheme indeed. It seems there's one rule for Bernie Madoff and another for the central bankers. But are they any different?

Ponzi Madoff admits $50bn fraud scheme!

Madoff's going to jail. Just how long is not certain, but Methuselah would be taken aback by the potential porridge he's about to do.

I like this quote from one of Madoff''s victims. Burt Ross is a former mayor of the New Jersey town Fort Lee. He told the BBC he did not expect to recover a single cent of the $5m he invested. "Bernard Madoff is a genius," said Mr Ross. "You're dealing with the greatest con artist probably in the history of the world. He created a mystique and associated with extraordinarily well respected and revered people, and so he was given the benefit of the doubt by financial regulators who blew it badly."

Blew it badly is an understatement. Most of these legalised cowboys (no offence to the real thing!) are still trying to make ends meet with other peoples' money.

One thing is certain, I think. Madoff will be in great demand in the jail for master classes for those who screwed up and failed to make a bean! The authorities should keep a beady eye on him. We don't want a group of well trained ponzi artists coming out all keen as mustard to do Wall Street over again.