Steve in TN

Avoiding Madoff Mayhem

There is one more lesson learned that the author did not bring up; that is don't invest in a hedge fund unless the amount is held by a reliable custodian. For example, many money managers allow clients to deposit their money in a brokerage firm and the money manager trades the clients account without being able to withdraw any funds from the account. This does not protect the client from incompetence (i.e. churning, poor investments, etc) but it does protect the investor from fraud and theft.