In one of the longest news articles I can remember reading in the New York Post, the SEC's Meagan Chung -- the woman who investigated Bernie Madoff in 2005 and cleared him of fraud -- tries, unconvincingly, to defend herself. Instead, she comes across as even less competent than we thought:
[Said Cheung:] "If someone provides you with the wrong set of books, I don't know how you find the real books." ...
Regarding Madoff specifically, Cheung said, "I never met the man."...
Markopolos gave the investigators a long memo that flatly said that "Madoff Securities is the world's largest Ponzi scheme."...
Soon after, in January 2006, the New York branch of the SEC opened an enforcement case on Madoff based on Markopolos' claims. The document authorizing that probe is signed by three SEC staffers: Cheung, attorney Simona Suh, and Assistant Director Doria Bachenheimer.
But after interviewing Madoff... the SEC probe "found no evidence of fraud," according to a case closing recommendation signed off by those three staffers.
The first quote here is utterly damning: Cheung seems to be saying that unless a fraudster actively cooperates with the SEC, there's no way he's going to be caught: The SEC just checks books against themselves, rather than against any kind of reality.
And the second is even worse: Cheung led the investigation, which included interviewing Madoff, but she herself "never met" him.
What's most striking is that Cheung shows no remorse at all: she never even says that she wishes she had uncovered the fraud, or that she's sorry she didn't. Instead, we get this:
"Everyone in the New York office behaved ethically and responsibly and did as thorough an investigation as we could do," said Cheung.
Did we ever live in a world where professionals take responsibility for their actions? I guess not:
"I supervised some lawyers and I was supervised by many levels above me. I'm just mid-level management."
It's just as well that Cheung has left the SEC already, for personal reasons. She certainly wouldn't be happy there now.