Madoff Victim Law School Dean on SEC Negligence – Failure to Investigate

The Rights Radio Power Hour features Madoff victim Lawrence Velvel, dean, Massachusetts School of Law at Andover, on SEC neglect and failure to investigate. Show Date: April 22, 2009 at 5:00 pm EST

A Massachusetts law school dean that lost money invested with swindler Bernard Madoff contends the Securities and Exchange Commission (SEC) was “willfully, horribly negligent” in failing to monitor his operation.

Now the federal judge overseeing the criminal case against Bernard Madoff has ordered the seizure of Madoff’s assets, making it impossible for victims to take action against those assets.

WHERE? The show was carried live on this page. Listen to the replay at the end of this page.

Lawrence Velvel, dean of the Massachusetts School of Law at Andover, said, “The SEC’s incredible willful negligence” to not seriously investigate Madoff’s operations despite repeated red flags and written warnings of his criminality probably makes the agency liable to legal action by aggrieved investors. The SEC, he said, “has no discretion—none—to fail to follow up, with serious investigations, when presented with knowledgeable, detailed, obviously highly competent, and in many respects easily ‘checkable’ allegations of…a huge fraud that is fooling thousands of people, stealing billions of dollars, and causing horrible injustice.”

Equally bad, says Velvel, the SEC was responsible for a lot of people being sucked into Madoff in the first place, because in 1992 it publicly announced that there was no fraud.

Referring to the preponderant majority of Madoff’s victims, Velvel said, “These are not the billionaires, or the huge institutions, that could hire expensive experts in due diligence…These are the plain people who worked hard and saved all their lives, as capitalism says they should, and who…depended on their government to protect them…but were failed by it because of one of the most willfully negligent, incompetent, and perhaps even complicitous courses of action any agency has ever engaged in.”

Lawrence R. Velvel is an honors graduate of the University of Michigan Law School. He has been a government lawyer, a lawyer in private practice, and a law professor. He is the author of a book on the Viet Nam War and civil disobedience, and of many law review and newspaper articles, including humor pieces written under a pseudonym. He recently wrote a quartet called Thine Alabaster Cities Gleam, comprised of: Misfits In America; Trail of Tears; The Hopes and Fears of Future Years: Loss and Creation; and The Hopes and Fears of Future Years: Defeat and Victory. Velvel blogs at velvelonnationalaffairs.com. His blog postings have been published in Blogs From the Liberal Standpoint: 2004-2005 and An Enemy of the People.

In 1988 he was one of the founders, and from inception has been the Dean, of the Massachusetts School of Law (MSL), a school which has introduced extensive reforms into legal education and which especially focuses on providing legal education to the working class, mid-life people, minorities and immigrants. He is the editor-in-chief of, and writes the introductions for, a journal of serious thought called The Long Term View, which is published by MSL. He is also the host of an hour-long television book review show, called Books Our Time, which is produced by MSL and seen throughout New England and the Mid-Atlantic states.

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