Koch Bros and Madoff

[Fanatical Meat]

Seems like the Koch boys made some money with Madoff and were lucky/fortunate enough to remove it before the hammer came down. Now they have been requested to pay it back because it was part of the scam. They aren't accused of doing anything illegal but now

Picard isn’t accusing Koch and the other defendants of wrongdoing. As in his many prior suits to recover cash, he contends the returns aren’t legitimate because Madoff used money from new investors to cover the fake profits of older ones. He has used that argument successfully in mostly domestic cases to claw back more than $11 billion for victims, who lost $17.5 billion in principal. (Some foreign defendants settled with Picard and moved on.)

but their accounts are essentially claiming it wasn't US money so its not subject to US law

Most of the $2 billion involves transfers from funds that were operated by Fairfield Greenwich Group -- by far the biggest feeder fund that channeled investors’ money to Bernard L. Madoff Investment Securities LLC, or BLMIS. Several other suits involve funds run by Tremont Group Holdings. Both are based in New York and dealt with their shareholders from their offices in Manhattan, even though they had feeder funds based in the Caribbean to capture foreign investments for Madoff, Picard says.

"Regardless of where these feeder funds maintained operations, their transactions related to BLMIS were predominantly domestic," Picard has said in filings in federal court in New York. Moreover, the customers knew their investments were subject to U.S. law, he argued.

2 billion is a lot of scratch but when you think about the original investment it probably would be a good idea to give it back, especially since their total worth is 109 billion.

oops here is the link

http://www.msn.com/en-us/money/mark...s-could-walk-away-with-madoff-cash/ar-BBtOOCp

 

[hal2kilo]

Seems like the Koch boys made some money with Madoff and were lucky/fortunate enough to remove it before the hammer came down. Now they have been requested to pay it back because it was part of the scam. They aren't accused of doing anything illegal but now



but their accounts are essentially claiming it wasn't US money so its not subject to US law



2 billion is a lot of scratch but when you think about the original investment it probably would be a good idea to give it back, especially since their total worth is 109 billion.

Wow, that almost seems not fair. Just because you don't know your profits were acquired in an illegal manner they can come after you. I guess it's sort of like ignorance of the law is no excuse.

Nah, don't feel sorry for a Koch.

 

[brycejones]

Wow, that almost seems not fair. Just because you don't know your profits were acquired in an illegal manner they can come after you. I guess it's sort of like ignorance of the law is no excuse.

Nah, don't feel sorry for a Koch.

Honestly though they have been pretty consistent. For the most part they have been clawing back proceeds and then distributing them so that losses for everyone who was taken are minimized.

 

[Fanatical Meat]

n/m the original amount invested in unknown

 

[Sonikku]

If someone steals something then sells it to you at an amazing price your ignorance of how it came to the seller may spare you punishment, but it does not mean you get to keep it. Stolen goods are to be given back.

 

[fskimospy]

Wow, that almost seems not fair. Just because you don't know your profits were acquired in an illegal manner they can come after you. I guess it's sort of like ignorance of the law is no excuse.

Nah, don't feel sorry for a Koch.

Yeah but their 'profits' were never real to begin with as all Madoff was doing was making up numbers and sending them statements. They money people put in was real, the extra profits people took out over their own investment were not, as it was just money stolen from other members of the ponzi scheme.

 

[hal2kilo]

Yeah but their 'profits' were never real to begin with as all Madoff was doing was making up numbers and sending them statements. They money people put in was real, the extra profits people took out over their own investment were not, as it was just money stolen from other members of the ponzi scheme.

I get it. It just would be a shock.

 

[TheGardener]

Everyone who withdraw fathom profits distributed by Madoff dating back to at least the 90's, has been ordered to pay it back to the government appointed trustee. This is not big news. In fact Koch was ordered in 2012 to pay this back. It is still in the courts, and the Koch defense is that the money went overseas and not subject to the reach of the US government. The defense is not based on when they withdrew the money.

 

[DrPizza]

I'm not much of an investor. But, if you're getting an awesome return, why do you pull your money out? Is it possible they figured out it was a Ponzi scheme?

 

[Fanatical Meat]

I'm not much of an investor. But, if you're getting an awesome return, why do you pull your money out? Is it possible they figured out it was a Ponzi scheme?

Difficult for a novice like you or I because it preys on our greed & desire to provide. When we add accountants or financial advisors/analysts it becomes easier. I'm sure someone in the organization said we've made enough with this fund its time to do something different we're not a investment bank and we shouldn't have too much tied up in this.
I'll admit I could easily fall for a scam like Madoff. Imagine doubling your invested money every 40 months. I would find that hard to walk away from it because I'd be too busy planing my retirement, then planning my early retirement, then my early retirement with a vacation home purchase and so on.
I believe this is why professional investors always say don't get attached to any investment. Hopefully Spungo(?) can post in here and explain it better.
I remember when his scam was exposed toward the end there were whispers about Madoffs financial filings and company profile made no sense. I'm sure toward the end guys who are used to dealing with big amounts of money were suspicious.

 

[who?]

Have any of the investors who paid income taxes on the phony profits been able to get any of the tax payments back?
I think that you mean phantom profits. A fathom is six feet of depth.

 

[who?]

OK, they got some federal relief but I don't know about state taxes.

 

[who?]

I'm not much of an investor. But, if you're getting an awesome return, why do you pull your money out? Is it possible they figured out it was a Ponzi scheme?

Diversification into other investments, buying houses, college money for the kids, maintaining an expensive lifestyle in a bad economy. The reason the scheme collapsed was because of all the investors who needed their profits in the terrible economy of late 2008.

 

[pcgeek11]

IMO I don't think anyone that unknowingly took profits from an investment should have to pay anything back. It is one thing if you knew, quite another if you did not.

I also feel the same way about stolen goods ( unless you are a pawn shop which has a whole set of rules just for this ).

 

[Jaepheth]

I'm not much of an investor. But, if you're getting an awesome return, why do you pull your money out? Is it possible they figured out it was a Ponzi scheme?

Most people who looked at the numbers knew something was wrong. Most assumed it was insider trading though, not a Ponzi scheme. I assume the Koch brothers or their advisers wanted to get out before the SEC brought the hammer down on whatever was going on.

This is an interesting technical read on it:
http://www.milliman.com/uploadedFiles/insight/pc-published/the-rat-without-tail.pdf

 

[who?]

IMO I don't think anyone that unknowingly took profits from and investment should have to pay anything back. It is one thing is you knew, quite another if you did not.

I also feel the same way about stolen goods ( unless you are a pawn shop which has a whole set of rules just for this ).

They THOUGHT they were taking profits but there weren't any profits for them to take. What they were unknowingly taking was other peoples money. And the crooks don't have enough money to pay restitution to the victims.

 

[pcgeek11]

They THOUGHT they were taking profits but there weren't any profits for them to take. What they were unknowingly taking was other peoples money. And the crooks don't have enough money to pay restitution to the victims.

All they knew was they were taking profits. They had no idea what was going on behind the curtain.

On your personal investments, do you question the dividends reported to you on your statement? I don't, that is profits as far as I am concerned. I don't KNOW that the investment company is just telling me a story and then giving me other peoples money or not.

 

[sportage]

I loved the two night mini series on ABC, MADOFF.
I thought it was some of Richard Dreyfuss best work.
Thats all.

 

[boomerang]

I'm not much of an investor. But, if you're getting an awesome return, why do you pull your money out? Is it possible they figured out it was a Ponzi scheme?

Pigs get fat, hogs get slaughtered applies. Dummies ride an investment all the way to the peak and hold on as it plummets down to the trough before getting out. Smarter folks realize that they got a good return and that it's time to move on. Everything runs in cycles.

 

[Fanatical Meat]

IMO I don't think anyone that unknowingly took profits from an investment should have to pay anything back. It is one thing if you knew, quite another if you did not.

I also feel the same way about stolen goods ( unless you are a pawn shop which has a whole set of rules just for this ).

I get it and I also get what happens if that money is spent or at some point Madoff ran a legitimate business when did it turn bad.
Think of it like stolen property. You could accidentally buy something that was stolen. Because you didn't know doesn't mean you get to keep it.

 

[Moonbeam]

I get it and I also get what happens if that money is spent or at some point Madoff ran a legitimate business when did it turn bad.
Think of it like stolen property. You could accidentally buy something that was stolen. Because you didn't know doesn't mean you get to keep it.

That is exactly what he is saying, you get to keep it. However if it were his car that was stolen and you paid for, he would suddenly claim he gets his car back. You have to realize that the weasel nature of the CBD is self protection via rationalization.

 

[Moonbeam]

Pigs get fat, hogs get slaughtered applies. Dummies ride an investment all the way to the peak and hold on as it plummets down to the trough before getting out. Smarter folks realize that they got a good return and that it's time to move on. Everything runs in cycles.

Yes, you are a fabulous person who is too smart to get scammed, a person so lacking in empathy for others, a person with a life so barren, that you actually have nothing else going for you than to inflate tour self by despising victims. Hope you find a real sense of self worth somewhere.

 

[boomerang]

Yes, you are a fabulous person who is too smart to get scammed, a person so lacking in empathy for others, a person with a life so barren, that you actually have nothing else going for you than to inflate tour self by despising victims. Hope you find a real sense of self worth somewhere.

Explore why you feel that my statement was me boasting about myself. What does that say about you and how does that make you feel?

 

[Fanatical Meat]

That is exactly what he is saying, you get to keep it. However if it were his car that was stolen and you paid for, he would suddenly claim he gets his car back. You have to realize that the weasel nature of the CBD is self protection via rationalization.

Think of the chaos it would cause with insurance, Moonie buys a 60k Tesla, it gets "stolen", I buy a slightly used Tesla for 5k and give Moonie 5k to cover his deductable and pain. Moonie files an insurance claim and now we both have 60kish teslas!

 

[Fanatical Meat]

Explore why you feel that my statement was me boasting about myself. What does that say about you and how does that make you feel?

Moonie you were wrong with that statement you should apologize. I assume you misunderstood.