A reader who happens to be a securities lawyer just sent the following comments on our most recent blog entry, Weighing in on Madoff and SEC Exams.
“When I learned about the Madoff situation, the first name that came to mind was Richard Whitney. As you probably know, Whitney was President of the NYSE and was famously convicted of embezzlement during the Great Depression. His fall was the result of an aggressive investigation by the SEC, and is often cited as the event that finally led to Wall Street’s surrender to SEC regulation. Whitney and Madoff were both icons of Wall Street, so it’s more than a little ironic that while Whitney’s disgrace may have “made” the SEC, Madoff’s fall may ultimately prove to be the agency’s unmaking – the final straw that broke the back of its credibility as a regulator in the eyes of the public.”
I didn’t know about Richard Whitney at all but it certainly meshes with our observations about tough economic times and the eventual surfacing of criminal activity. Such activity is not without precedent and might – unfortunately — even come to be expected. (Remember Enron?)
If you would like to learn more about the life and times of Richard Whitney, click here.