The whistleblower who uncovered Bernie Madoff’s Ponzi scheme told the House panel today the Wall Street Journal didn’t want to investigate the scandal three years ago. Harry Markopolos approached reporters at the WSJ but they never followed up on the tip.
In prepared testimony to the House today, Madoff tipster Harry Markopolos said the Wall Street Journal blew their chance at uncovering Bernard Madoff’s Ponzi scheme several years ago. The investment manager turned financial fraud investigator said in his statement that he contacted reporters at the WSJ in June 2005, offering evidence Madoff was scamming investors.
When he emailed John Wilke, senior investigative reporter for the Wall Street Journal‘s Washington bureau, he found out the paper’s editors weren’t interested in pursuing the story. He said: “Unfortunately, as eager as Mr. Wilke was to investigate the Madoff story, it appears that the Wall Street Journal‘s editors never gave him approval to start investigating.”
He also lumps the Wall Street Journal and the SEC in one unattractive basket: “Unfortunately neither the Wall Street Journal nor SEC were inclined to even pick up a phone and dial any of the leads I provided to them.”
Today, when questioned about the Journal’s lack of response, he said the reporter was ready to write the story, but he thinks senior editors feared Madoff and never allowed the reporter to pursue the story.
Also, Markopolos told the House the losses attributed to Madoff’s alleged fraud are probably $15 billion to $25 billion, rather than the estimated $50 billion. He took a parting shot at the SEC at the end of his testimony, saying, “If you flew the entire S.E.C. staff to Fenway Park, they wouldn’t be able to find first base.”
