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Power on… It is the monthly opinion column of Marc Powers. After his tenure at the SEC, he has dealt with complex securities-related cases for most of his 40-year legal career in the United States. He is now an adjunct professor at the Florida International University School of Law, where he teaches the “Blockchain, Encryption, and Regulatory Considerations” course.
On the evening of December 11, 2008 (Thursday), I was downstairs in a bar in the Upper East Side of Manhattan. When the call started, I was playing a friendly game of Texas Hold’em.
They came one by one and continued in the office the next day. The theme is the same. This person, Bernie Madoff, was asked to represent the victims of various frauds.
At this point, I have never heard of him, but within a few days, the whole world will learn about this evil criminal behavior and his virtual transactions, which will become the world’s largest personal financial fraud and Ponzi scheme. . Some calls come directly from the victims themselves. Others come from their accountants and non-securities lawyers, who refer their affairs and clients to me from time to time.
What I heard was ugly. Many callers seem to have lost millions of dollars. For some people, this represents their life savings. Others rely on funds entrusted to Madoff to pay for the children’s upcoming college education. Many victims put almost all of their disposable funds into the person’s “investment fund”, where they receive high investment returns on a regular or quarterly basis to cover living expenses.
Madoff’s unprovoked fraud involving many Jewish communities and charities in New York, Los Angeles, Palm Beach, and parts of Minnesota and Michigan is harmful. In his activities, he exhibited an atmosphere of secrecy and exclusivity, trapping himself in the circle of “friends and family”. He has held important positions on exchanges such as the Nasdaq and Cincinnati Stock Exchange. His obvious status as a famous financier caused many victims to fall because of this credibility and trustworthiness.
As the national head of the securities litigation and SEC law enforcement business of my law firm, and with experience representing Ponzi schemes and internal investigations, I will be invited to participate in a group of lawyers to meet with Irving Picard, Irving Picard Irving Picard became the trustee appointed by the SIPA court to supervise the Bernard L. Madoff Investment Securities, Inc. (Bernard L. Madoff Investment Securities, Inc.) that SIPC ran through the failed broker-dealer Madoff.
After Irving joined Baker Hostetler and was selected as SIPA trustee by the court, our work sometimes expanded to more than 250 lawyers throughout the law firm.
For four years, I have been a core member of the trustee’s work, and will lead our national work, conduct investigations in the United States, develop the theory of responsibility, and file lawsuits against hedge funds to recover the reported losses of 65 billion US dollars. Facts have proved that this figure is actually less than 20 billion US dollars. It is still a huge number.
My small team is personally responsible. This is the recovery of our company in the past twelve years. So far, it is the largest settlement of hedge fund Tremont so far, and the second largest settlement of cash for anyone. The total amount of cash exceeds 1 billion US dollars.
There are still lessons from the Madoff scandal
With Madoff’s death on April 14th, I have been thinking about his fraud and how this legend can provide some interesting and useful lessons for people nowadays, and consider entering the field of cryptocurrency, especially in the 1980s. The “memecoins” aspect. The rapid spread of social media and viral information.
These observations include the continued attractiveness of the “follow the crowd” mentality and the lack of financial and investment acumen for those investing in the stock and cryptocurrency markets. It can be said that many of Madoff’s personal victims, even institutions, failed to understand and question his trading strategies, which are said to (and surprisingly reflect on) provide “profits” in both the upper and lower markets. Red flags are common. Especially those so-called hedge funds that invest in what Madoff calls investment funds.
Today, we have a group of people buying stocks like GameStop and increasing their market value from less than $1 billion to more than $12 billion since the beginning of this year. Many people are just following the crowd, which is what some people in the Madoff era did.But what do these Reddit pirates do Really know About business? What is its outlook? Or for that matter, how to analyze the company’s stock price?
I suspect that many people who follow the crowd pushed the stock price above $400 and briefly pushed GameStop to a market capitalization of over $20 billion, which proves the massive margin calls and liquidity issues that Robinhood exchange encountered during its toughest period. Prove this. Crazy trading hours.
Dogecoin should scare you now
Let’s also look at Dogecoin, which was a joke in 2013, mocking all the various altcoins. As of January 26 this year, it was worth less than a cent, which is right, because at best it is used as a way to remind others on social media sites.
However, now it has become one of the largest cryptocurrencies in the world, trading as high as 70 cents this week, and then plummeting. Its main promoter, Elon Musk, apparently failed to make an appearance on Saturday night. Left a deep impression on the so-called Doge Army.
Will this be great for TikTok fans and Musk’s Astronomy Twitter? Social phenomena are usually short-lived, and it is hard to imagine that Dogecoin has a sustainable use case, no matter how much we love Shiba Inus.
What about NFTs? For me, I am currently ambivalent about this use of blockchain technology. On the one hand, I see the appeal of having unique digital artwork (such as a physical artist’s proof). On the other hand, I just didn’t get great value here. At least you can hang the artwork on the wall, in the gallery, or donate it to the museum for public viewing. What is the use of a $69 million Beeple? Bring out a 6-inch smartphone or laptop to show off the artwork you own?
The above is a statement. There are many trends in the cryptocurrency field, just like any technically challenging new financial technology, it is full of scammers and fraudsters who are trying to separate you from your money.
Therefore, know what you want to invest in, conduct your own research, and don’t always follow the trend.
Boot update…
In my last column I oppose the U.S. Securities and Exchange Commission (SEC) Because it seems to be out of scope in the SEC v. Ripple lawsuit. The US Securities and Exchange Commission (SEC) subpoenaed six financial institutions and the local Federal Reserve (Fed) for eight years of personal records to record the identities of the two Ripple executives in the lawsuit. Well, I am happy to report that Sarah Netburn, the magistrate, agreed with me. She discovered that the requested behavior was improper and ordered the SEC to withdraw the subpoena. Let us listen to our judiciary!
In the first monthly column in February, I proposed The dollar’s dominance may decline If we do not accept the central bank digital currency faster, then it is on a global scale. I am worried that China is already developing and adopting a digital renminbi, which I think poses a threat to the US dollar. Well, I am happy to report to you that other people, including Congress, are also receiving attention. Last month, Kevin McCarthy, the minority leader of the Republican House of Representatives, issued a similar alarm.
Mark Bowles He is currently an adjunct professor at the Florida International University School of Law, where he teaches “Blockchain, Encryption, and Regulatory Considerations.” He recently withdrew from his practice career at the Am Law 100 law firm, where he formed a national securities litigation and regulatory enforcement practice team and a hedge fund industry practice team. Marc started his legal career in the SEC Enforcement Department. During his 40-year legal career, he was involved in representation including the Bernie Madoff Ponzi Project, the recent presidential pardon and the Martha Stewart insider trading trial.
The views expressed are only the personal opinions of the author and do not necessarily reflect the views of Cointelegraph, Florida International University School of Law or its affiliates. This article is for general reference only and is not intended and should not be regarded as legal advice.
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