No One Would Listen, Essay Example

Summary

The book” No One Would Listen by Harry Markopolos was an introduction to Bernie Madoff, who was an American thief and former stockbroker that created the worst Ponzi scheme in American history. Madoff used his investment and securities company “Madoff Securities LLC to trick the public and the Security & Exchange Commission(SEC). The book is about an inside look 10 years before Bernie Madoff explained by Harry Markopolos. The step by step analysis of the different characters involved along with complex events that lead to Ponzi scheme exposure. Harry does a wonderful job of describing the extensive details over a 10-year period sending information to the Security & Exchange Commission(SEC) trying to expose Bernie Madoff.  The media tried to blame the auditors that missed the Ponzi scheme however, Harry Markopolos proves it was Bernie’s Madoff deceit (Goldstein,2015).

The number one lesson learned from Bernie Madoff’s Ponzi scheme is every potential investor or client should make sure the funds are being held in an independent bank. Bernie Madoff was able to hide, alter, and change the client’s financial statements. The only people that created the statements were from Bernie Madoffs company.  Secondly, Bernie Madoff was an unknown accounting firm which would be a red flag that they are not quite established and handling billions of dollars(Biography,2015).

Favorable Elements

The discussion with Madoff in the first chapter really provide some insight to Madoffs’ state of mind about the worst Ponzi Scheme in history. The news media and public showed their disgust with Madoffs actions, however few endeavor to discuss Madoff the man. The author Harry Markopolos describe Madoff as the arrogant man that had all the answers and avoided the SEC with precision and lies. Harry pointed out that anyone in the future that has retirement money managers handling their financial affairs must make sure that checks and balances are put in place to protect their money.

There were many discussions and perceptions about what drove Madoff to create and sustain the Ponzi scheme. However, David Kotz interviewed Bernie Madoff finding the personality flaw that destroyed Madoff. In the interview, Madoff answered all questions like a successful money manager selling to a client until Harry Markopolos named was mentioned during the interview. The question was asked “What do you know about Harry Markopolos? At that moment, David Kotz noticed that Madoffs’ entire attitude from happy turned sour. Bernie Madoff was angry and jealous that Harry was stealing the headlines and taking his glory. It was clear that the man that swindle thousands of innocent people and billions of dollars lost was no Bernie’s concern. Madoff was more concerned about the media attention rather than being remorseful for the people he hurt.  The following comment clear shows was more concerned about Harry taking the limelight away from Madoff. “As Kotz listened to him, he began to realize that Madoff considered me a competitor and appeared to be bothered by the fact that I was getting attention that rightfully belonged to him.” This statement clearly shows the arrogance and lack of compassion for all the lives he destroyed. Madoff was more concerned about getting the attention to feed his ego.

Unfavorable Elements

The author Mark Markopolos did a wonderful job of taking about all the warning signals to the Security & Exchange Commission(SEC) over a 10-year period. The SEC is responsible for missing the Ponzi scheme with numerous investigations by the SEC. Consequently, the book should have spent more time discussing about the people lost their life savings during the Ponzi scheme. The theme of the book concentrated on the characters involved that had money but did not succumb to the Ponzi scheme. The wealthy characters involved did not seem to be empathetic to those that saved for their entire life and lose it all in one day.

Elements Not Liked

The book concentrated on the damage to the SEC reputation, the reputation of Bernie Madoff and all the characters involved including investigators of the Ponzi Scheme. However, not enough of the book was shared about people that were damaged and how much money some of those individuals lost. There are many people that went public that lost their entire 30 years’ life savings. The real characters’ stories would have made the book more interesting. However, did not like that the book was more concerned about the SEC and the financial institutions that were damaged instead of the damage to human beings.

Changes to Book

The primary changes would be discussing more about the individuals that were destroyed and how the courts plan on making sure those families received as much cash back as possible. The premise is the money was confiscated by the government and all of Bernie Madoff hidden funds had been found should have been put in a fund for victims.

Best Elements of Book

The best elements of the book were the listing of all the characters that were involved with the financial industry such as the financial wizards Dan DiBartolomeo, Jeff Fritz, Leon Gross and Andre Mehta. These are some the smartest men on Wall Street that were not able to detect the fraud however, they did not believe some of the results but Bernie Madoff made it difficult to prove.

Characters

The character Harry Markopolos was the best character because he followed the history of Bernie Madoff from day one until he was arrested. Harry is believable with many facts that did not come out in the newspaper. The author unfolds the story with the detailed explanation of Harry Markopolos. Harry Markopolos was a qualified financial guru that understood numbers and how complex formulas worked to make money. It was chronicled how early in the Ponzi scheme how he figures out Bernie Madoff was a fraud.  This was the main idea of the book to get an inside look at the inner workings of the Wall Street financial district.

Frank Casey characters added to the credibility that the team of Harry, Neil and Frank put up red flags to everyone including the SEC but no one listen. Franks character was convincing and truthful about his dealings with Bernie Madoff. Frank was a smart financial and marketing genius that understood complex strategies. Frank was one the first characters that felt the numbers did not add up to the returns suggested by Bernie Madoff. Franks character provide another view from one the characters responsible for reporting and ultimately exposing Bernie Madoff as a fraud. Frank character was about good old fashion working hard with a reputation of being in the finance industry for many years. Frank Casey had been working in the industry for more than a quarter of a century(Markopolos,2010,)

Themes

David Kotz the professional interviewer character was unique because he was given access to Bernie Madoff which allowed him to interview him to see how he was responding to being caught for the Ponzi scheme. It was a small part with a limited theme yet powerful to start the book with a bang! Neil Chelo was a very informative and smart analyst on the Madoff team. The book used this character to tell another story and sub plot about how Harry and Neil found out Madoff was a fraud. Neil had an obsessive personality which went well in the financial world because he was obsessive about his own finances checking and triple checking investments and financial decisions. Harry mentored Chelo who graduated from Bentley College of business in Waltham, Massachusetts. His character explained how he was qualified along with Harry to analyzed all these complex formulas. The theme worked very well because the book was convincing is explaining how they figure out he was a fraud long before the SEC decided to act.

The theme of the attorneys Ira Lee Sorkin, Nicole DeBello and Harrys personal attorney. The primary theme of attorneys was based on Gaytri Kachroo who made sure that Harry Markopolos would not be charges or railroaded because he made some many complaints to the SEC. The book tried to explain how the relationship with Gaytri and Harry allowed them not to be bought off or stop by other forces concerning the aftermath and fallout of bringing Bernie Madoff down. The author wanted to show why Gaytri was different from other attorneys. She was an attorney with five law degrees and she graduated from Harvard with a law doctrine. Gaytri would represented Harry in the False Claim Act court case but she did not know anything about Bernie Madoff until he was arrested. The book chronicled how Harry brought down Madoff and protected himself with his attorney Phil Michael and Gaytri Kachroo. These themes were effective because it provides the reader with the detailed look at the investigation and the SEC blunders.

Conclusion

The book is a good read with very detailed information about the Bernie Madoff Ponzi scheme. It was emotional to watch the SEC ignore all the complaints and let Bernie Madoff go another 10 years cheating people. I would recommend this book to everyone because it’s a human interest story with a ringside seat on Wall Street. However, I would tell them that they must first keep an open mind and do not be swayed by the media. This is the true story from Harry Markopolos who was the hero trying to stop this madman from day one of the Ponzi scheme.

References

Biography.com (2015). Bernie Madoff: Biography. Retrieved from http://www.biography.com/people/bernard-madoff-466366

Goldstein, M. (2015, May). Madoff accountants avoid prison term. Retrieved from http://www.nytimes.com/2015/05/29/business/dealbook/madoff-accountant-avoids-prison-term.html?rref=collection%2Ftimestopic%2FMadoff%2C%20Bernard%20L.&action=click&contentCollection=timestopics&region=stream&module=stream_unit&version=latest&contentPlacement=4&pgtype=collection&_r=0