Only sorry he got caught

Madoff pleads guilty and goes to jail in handcuffs

By LARRY NEUMEISTER and TOM HAYS, Associated Press Writers
1 min ago
NEW YORK – Saying he was "deeply sorry and ashamed," Bernard Madoff pleaded guilty Thursday to pulling off perhaps the biggest swindle in Wall Street history and was immediately led off to jail in handcuffs to the delight of his seething victims.
U.S. District Judge Denny Chin denied bail for Madoff, 70, and ordered him to jail, noting that he had the means to flee and an incentive to do so because of his age.
Madoff spoke softly but firmly to the judge as he pleaded guilty to 11 charges in his first public comments about his crimes since the scandal broke in early December.
"I am actually grateful for this opportunity to publicly comment about my crimes, for which I am deeply sorry and ashamed," he said.
"As the years went by, I realized my risk and this day would inevitably come. I cannot adequately express how sorry I am for my crimes."
Prosecutors say the disgraced financier, who has spent three months under house arrest in his $7 million Manhattan penthouse, could face a maximum term of 150 years in prison at sentencing June 16.
DeWitt Baker, an investor who attended the hearing and said he lost more than a million dollars with Madoff, called it "fantastic" that Madoff's bail was revoked but belittled the apology.
"I don't think he has a sincere bone in his body," said DeWitt, who added that prison time would be too good for Madoff.
"I'd stone him to death," he said.
Madoff did not look at any of the three investors who spoke at the hearing, even when one turned in his direction and tried to address him.
The fraud, which prosecutors say may have totaled nearly $65 billion, turned a revered money man into an overnight global disgrace whose name became synonymous with the current economic meltdown.
Madoff described his crimes after he entered a guilty plea to all 11 counts he was charged with, including fraud, perjury, theft from an employee benefit plan, and two counts of international money laundering.
He told the judge that he believed the fraud would be short-term and that he could extricate himself. He implicated no one else, though investigators suspect involvement by relatives and top lieutenants who helped run his operation from its midtown Manhattan headquarters.
The plea came three months after the FBI claimed Madoff admitted to his sons that his once-revered investment fund was all a big lie — a Ponzi scheme that was in the billions of dollars. Since his arrest in December, the scandal has turned the former Nasdaq chairman into a pariah who has worn a bulletproof vest to court.
The scheme evaporated life fortunes, wiped out charities and apparently pushed at least two investors to commit suicide. Victims big and small were swindled by Madoff, from elderly Florida retirees to actors Kevin Bacon and Kyra Sedgwick and Nobel Peace Prize winner Elie Wiesel.
Helicopters circled above the courthouse before the hearing, and federal officers with machine gun-style weapons stood outside as Madoff arrived.
Jilted investors signed in before entering the courtroom on the 24th floor. Richard and Cynthia Friedman turned up to get a glimpse of the man who defrauded them of their life savings of $3 million.
Richard Friedman, an accountant, noticed how well his clients were doing with Madoff and began investing his own money in 1991. He learned it was gone months before he had planned to retire — a plan now on hold.
"I wanted him to see some of the faces of the people he lied to and destroyed," said Cynthia Friedman, 59, of Jericho, N.Y.
After arguments began on whether Madoff should remain free on bail, his lawyer Ira Sorkin described the bail conditions and how Madoff had, "at his wife's own expense," paid for private security at his penthouse.
Loud laughter then erupted among some of the more than 100 spectators crammed into the large courtroom on the 24th floor of the federal courthouse in lower Manhattan. The judge warned the spectators to remain silent.
George Nierenberg, the first of the three investors to speak, approached the podium glaring at Madoff, then said in the financier's direction: "I don't know if you had a chance to turn around and look at the victims."
At the hint of a confrontation, a marshal sitting behind Madoff stood up, and the judge directed Nierenberg to speak directly to the bench.
The courtroom erupted in applause after the judge announced Madoff would go directly to jail. As he was led out of court, a spectator yelled, "Hey, Bernie," but was shushed by investors in court and backed off.
The plea does not end the Madoff saga: Investigators are still undertaking the daunting task of unraveling how he pulled off the fraud for decades without being caught.
Court papers say Madoff generated or had employees generate "tens of thousands of account statements and other documents through the U.S. Postal Service, operating a massive Ponzi scheme," prosecutors said.
The money was never invested, but was used by Madoff, his business and others, prosecutors said.
Authorities said he confessed to his family that he had carried out a $50 billion fraud. In court documents filed Tuesday, prosecutors raised the size of the fraud to $64.8 billion.
Experts say the actual loss was more likely much less and that higher numbers reflect false profits he promised investors. So far, authorities have located about $1 billion for jilted investors.
In addition to prison time, he said Madoff faces mandatory restitution to victims, forfeiture of ill-gotten gains and criminal fines.
___
Associated Press writers Jennifer Peltz and David B. Caruso contributed to this report.

The best latte

Didn't sleep much last night- My subletters leave in a wee less than 3 weeks which means I have to go back to Santa Monica and be forced into things I don't want to do just yet (or at all in some things). Unless a miracle happens and I get a job soon. VERY SOON.

Even Kennedy knows I'm paralyzed with anxiety right now. Instead of sleeping at my feet, she squeezed her body along side mine on that very narrow couch I've been calling a bed for 3 months. I don't even have money to buy my flight back to California. Don't have the money to bring the animals to a vet for a flight certificate. Then, of course, no money to fly them with me.

And as it looks like I may be forced to spend April packing up to move back to Illinois - into my mother's home - 100% dependent on her indefinitely....well I slip into a depression I'm determined to fight. But some days even walking homeless dogs and helping kittens post-surgery won't remove the sludge from my heart. Thanks to yet another one of my mother's fits, I try to consider really how bad it would be to just live on the streets vs more time enslaved to her and her anger.

So before I walk doggies, I treat myself. More Intelligensia. Since it's my 1st cup of the day, I can enjoy one of their award-winning lattes. Made by the recent winner of the US Barista Championship, Michael Phillips. I get lucky and he's here this morning. My latte is exquisite. Both to see and taste. The photo above is me enjoying my, eh, 3rd sip. It's so beautiful I hate to drink it not wanting to destroy the artful way he poured the steamed milk. But to drink it- ahhhhhhhhh-- for now my anxiety lessens...and I'm able to give 4+ hours of this snowy day to 30+ homeless dogs I've been neglecting this past week thanks to flu bugs and motherly surprises.

Getting that 2nd pint glass

Started today abruptly - alarm on my phone waking me at 6:30am. Funny, the last 2 years I was getting up at 5am to take care of dying kitties or walk doggies before getting to my job at 7am. And now a 6:30 wake-up is painful. Honestly, I think the latter is healthier. 5am wake-ups for a low-paying, dead-end job was insane.

So the temp plummeted last night which made me lazy which resulted in Kennedy simply getting the quick, lame "ok honey, just do your thing in the back yard".

Off to Argonne Labs with mom. I can't recall what today's presentation covers. I think it's a standard-maintenance type thing tho. Usually the crisis counseling comes with a colourful, sad story. And I'm drawing a blank here.

I wasn't planning to go, but last night she assured me this was a quickie so we'd be done by noon. This morning the story changed and now I have no idea how long I'm stuck in this coffee shop drumming up ways to take advantage of my lock-up. I've scoured all my usual job boards, applied for the 3 jobs posted for which I'm qualified. Checked email. Checked and played about Facebook. Even read PerezHilton - a bad bad habit I thankfully broke in my unemployment. When your life is fulfilling, you don't need the pain of others to entertain you...

Eventually, I'll get to leave. Take her to her office downtown, then join my college friend, Mike, at Corcoran's on Wells. They're doing this month-long Guinness promotion on Wednesdays. $5 Guinness and you keep the pint glass. I need new glassware for my non-existent kitchen. $6 pub burgers. 35cent wings. The bartender told us last week we'd get an email offering 50% off the wings, but I haven't gotten yet- I hope Mike did!

******
Picked up mom at Argonne - she's smiling...a rare sight. It's both sunny and relatively warm....a rare coupling in Chicago. She needs to take care of some banking business for her mother, then we eat. I ask if she'd prefer to eat out in the burbs, or still wants to grab a burger at the Irish pub on Wells. "I'm starved! let's eat here!" Somehow in our discussion, I realize she's not planning to go to her office today. I balk at change, I inform her I had plans to meet a friend in the city while she was at work. She claims I should have known we weren't going into the city. Same old crazy-making miscommunication from her. The story changes second-by-second and when you call her on it, she still answers non-sensically but in a tone normally attached to certainty. This crazy, changing plans without notifying the other parties, is not rare for her. I ask myself why I continue to believe her when she assures me of her plans. At least I stopped making commitments with anyone 2 months ago. Too many last-minute cancellations from me accompanied by humiliated apologies and the dread that "great, I'll never get a job here thanks to proving I'm unreliable". But I continue to believe her and make wish-washy plans accordingly despite her fairly consistent game-changing. When do I develop some sort of insurance to protect myself against this?

So we go the pub anyway. Broken meter. Sunny day. Warm day. Beautiful day to enjoy some mother/daughter time. She chooses the silent treatment. The martyr treatment. We sit in the pub where she sits silently scowling. Our 1-hour there feels like 10. I think about the week before when 2 1/2 hours flew by laughing with Michael and the bartender.

I think about how much personal sunshine I'm missing by being enslaved to my mother's whims right now. About my life in Santa Monica and my beautiful neighbours. About my life in Chicago if I could afford rent. THIS IS THE TIME TO REALLY ENJOY LIFE. And I'm locked in a depressed, cluttered house of sadness and anger.

I NEED TO FIND A WAY OUT

We get home about 3:30pm. I go to my little room and lay on my "bed". It's a beautiful day to take Kennedy for a nice long walk. But I curl up miserable in the back room and fall asleep until 6pm. I wait impatiently for mom to go to church. Thank G*D for church. The 2 hours she's gone, I breathe again and laugh and play with Kennedy and the babies. Mom still isn't home. She's apparently staying away from home avoiding me. ugh. So I go back to my little room and back under the covers and get to sleep before she comes home.

Good thing she goes to church twice a week. Seems to really help her be a good Christian....

Cool idea a little late

Some of my favorite blogs are those which simply share day-by-day trivial happenings. Because I find people fascinating and beautiful -- anything is colourful to me. But for me to share daily nothings seems way too self-absorbed even for me.

On further thought, during this extraordinary time in our generation, it might be interesting, humourous, fun for others to read the day-by-day experiences of a full-grown, well-educated, ambitious, otherwiseresponsible adult sponging off her mother thanks to 8 months of unemployment and a crazy unemployment officer.

So here is my 1st post-- 7 months too late. All the really good stuff happened between September and February. I have a sneaky feeling my life is settling down to managable now. well poop.

Well there's something new- I finally found a way to keep my kittens' litter box clean fast enough to avoid my dog enjoying kitty poop snacks.

there.

So here's today. A very lame, self-indulgent day. Maybe I'll back-track and fake-post "real day-by-day events" just for kicks.

Today began with a long walk with Kennedy. Something quite rare these days given the crazy Chicago winter weather. It was supposed to thunderstorm, but today began without rain, so I thought I better take advantage and take her out. It's been 3 days since she got significant time outside and it's supposed to rain until the weekend. Then again, the weather changes so quickly here, the meteorologists have mis-predicted it every week of the 3 months I've been out here.

Hold on- today began at 6am when I heard a glass crash in the kitchen. My mother's house is far from kitty proof. I've given up trying to safeguard her stuff piled up anywhere and everywhere. So this morning I was woken by Monroe, in her nightly mousehunt, knocking over what became my favorite beer glass here. The 16oz Bears glass my mom got for free from some gas station 20 years ago. When I went to the loo, Monroe ran in as usual and we played and she purred and she snuggled in my lap. On the toilet. Just like Misha. hmmmm

Right now I'm experiencing a heavenly overload of the senses. Rain. City smells. Pedestrians from every background making their way down Broadway. Skyscrapers hidden under heavy rain clouds. Smell of Intelligentsia coffee. The sound of the espresso machine artfully creating the best cappucino in town. People discussing art, literature, politics and laughing. 2 older men playing chess. Devotchka playing through the speaker above me. The muffled roar of the #36 bus. The taste of a REAL chai made from black tea stirred with ground vanilla seed, nutmeg, clove, cinnamon, honey and milk. No boxed syrup here. As the song ends, the voices get softer. My head buzzes my eyes drink in the beauty of this misunderstood city. The door opens and the cool wet air blows in accompanied by the smell of fresh rain mixed with taxi exhaust.

Hmm the restaurant across the street has $5 pad thai on Thursdays. I'll have to come back. Wed $5 Guinness. Thurs $5 pad thai. Recessions are fun.

After dropping off my mother, I went up to that Starbucks on North Avenue that has the parking lot. I'm so poor, 50cents for a meter is too much for me right now. I use the Starbucks card my sister gave me to buy a drip coffee knowing I can get a free refill too. Spent 2 hours reading email, playing on facebook, researching ideas for writing, checking what little money I have in my bank account, applying for the 2 jobs I found looking at 12 job sites.

Ran to Borders on North/Halsted for their 50% off sale. Never used my Borders gift card from the holidays. Waited for a sale to make my spending worthwhile. Bought 6 movies-- Barton Fink, Breakfast at Tiffanys ("Cat! cat! ohhhhh where are you cat?! cat!"), Amadeus, Sweeney Todd, The Apartment, and that crazy anime film who's name escapes me right now. I wanted Lagaan, but Borders doesn't carry it. But thanks to my brilliant reenactment of the film's highlights, the staff now wants to get a copy of the film to see its epic epicness for themselves.

NOW it's pouring. I notice the time. I should have walked dogs at PAWS. dammit. I'm so selfish. Those poor dogs don't have enough volunteers to walk them and here I was available and it wasn't raining until noon and I spent my time in a coffee shop and book store.

Off to Trader Joes on Clybourn to pick up some food for dinner tonight. And some electrolyte water for mom. When I write my fake "today's events" post for the weekend, you can read why we need electrolyte water for my mom.

Then to Kreiser's for raw food for Kennedy. I feel sick about this. I want to support Eric's store on Lincoln. He was so sweet giving Kennedy oodles of free treats and food when we first walked into his store in Jan and both looked visibly shell-shocked by our life that month. But he charges $7 more than the other stores. As much as I prefer supporting small businesses, I have to support myself and my babies 1st right now...sigh...

On to DSW to find some galoshes. $60?! I can buy designer boots for less at Bloomingdales. ugh. I'll continue to live with soggy feet.

ok- 1 more hour to kill before picking up mom from Rush/Chicago. I. Need. Internet. So tired of living in Starbucks tho. Hateful. Got it- Intelligensia, My favorite little privately-owned coffee shop when I lived here. Now they have a shop in Silverlake. California. So I come in, it's huge. The yuppies have gone! Perhaps it's the 2pm weekday time that's responsible for this. Good times anyway. I get a chai + some banana bread. Thanks to Mom for loaning me money to buy golashes.

Well, now it's 3pm and I have to resume chauffeur duties. Pick up mom, take her out to Tinley Park for her dentist appointment. Go home, take Kennedy out. Make dinner for everyone. Collapse on the couch to watch The Biggest Loser and old reruns of Boston Legal.

Told you today was a lame one...

Ah-ha!

How Wall Street Continues To Doom Itself
January 30, 2009 11:34 AM ET | Rick Newman | Permanent Link |
We’ve arrived at an ah-ha moment.

Virtually everybody who butters their own bread is outraged that Wall Street, which is becoming a de facto government agency thanks to billions in bailout money, found $18.4 billion in bonuses for bankers who nearly wrecked the world’s financial system in 2008. President Obama’s criticism – “shameful” – is mild compared to what many of us think.

The bankers are bellyaching about a 44 percent decline in bonuses from 2007 levels. That’s like complaining about being served a 40-ounce porterhouse instead of a 70-ounce one.

[See why "Wall Street talent" is an oxymoron.]

Here’s a bit more perspective: Charles Payne, CEO of the research firm Wall Street Strategies, points out that in 1985, Wall Street bonuses totaled $1.9 billion. The average recipient got $13,970. Since 1985, inflation has run 97 percent in total, according to the Bureau of Labor Statistics. That means that something worth $1 in 1985 would be worth $1.97 today. So follow the math:

Wall Street bonus pool in 1985: $1.9 billion

Value in 2008, if indexed for inflation: $3.75 billion

Actual 2008 bonus pool: $18.4 billion

Amount by which bonus pool exceeded inflation: 490 percent

Average Wall Street bonus, 1985: $13,970

Value in 2008, if indexed for inflation: $27,580

Actual average bonus, 2008: $112,000

Amount by which average bonus exceeded inflation: 406 percent

So pay for top Wall Streeters has risen 4 to 5 times as much as the rate of inflation since 1985. Of course those bankers are worth it, because of all the great things they’ve done for America during that time, like engineer the Long-Term Capital Management meltdown in 1998, the tech bubble that burst in 2001, the housing bubble that’s still bursting, a credit freeze that’s producing hypothermia at hundreds of real companies that actually make stuff, and the near collapse of the financial markets.

[See why it was a good move to let Lehman Brothers fail.]

If there’s a crowning absurdity, it’s that Wall Street mustered any bonuses at all in a year when the industry lost $34 billion. Does anybody else in America get a bonus when their company tanks? “Rewarding cataclysmic failure like this has to be what led to the fall of the Roman Empire,” Payne wrote in a recent note to clients.

It’s worth pointing out that not all Wall Street firms are as wayward as big offenders like Citigroup, Merrill Lynch, AIG, and Bank of America. Many made money in 2008, and any firm that isn’t asking for taxpayer handouts should be allowed to pay its people whatever it wants.

[See five pieces missing from Obama's stimulus plan.]

But the bonus brouhaha reveals so many disconnects in the financial industry that it could end up being a pivotal moment in the dismantling of the old Wall Street. Derivatives and “funding facilities” are hard for most people to understand. But gimme gimme gimme is a corruption we all understand. If the politicians didn’t have a clear rallying cry for going after Wall Street before, they sure do now.

Another reason to boycott Macys

As if their flagrant disrespect for Chicago history wasn't enough...

C'mon, I know this is actually 2004 bonus money, but getting all this cash ONE DAY after laying off 7,000 paycheck-to-paycheck employees... If this is your bonus, something tells me your annual salary is more than enough to pay the bills after giving back this money to save jobs of those who will be homeless without.

Seriously- I'm sleeping on my mother's couch in her living room for 3+ months because the state of California is too bankrupt to give me the unemployment funds it owes me. I'm a lucky one-- I know others who are sleeping in stairwells thanks, again, to CA bankruptcy. If WallStreet used that bonus money to pay their bills vs. incompetent staff wallets, perhaps there would be funds avail for state governments to pay their massive unemployment benefits- Jesus.

Macy’s execs get performance bonuses

By John Eckberg
jeckberg@enquirer.com

A day after Macy’s executives announced lay-offs of 7,000 workers and cut a dividend in half, top company officials received a final installment on $1.39 million in performance bonuses from 2004.

The stock credit plan created in March 2004 brought five top executives “phantom stock units” or stock credits after a three-year holding period ended on Saturday, according to a Securities and Exchange Commission filing on Tuesday.

Half of the incentive was paid in February 2008 with the remaining amount paid Monday.

Payments for stock credits and accrued dividends were as follows: Chief executive Terry J. Lundgren, $613,281; Karen Hoguet, chief financial officer, $192,742; Thomas Cole, chief adminstrative officer, $227,794; Janet Grove, vice chair, $227,794; Susan Kronick, vice chair, $227,794.

On Monday the company announced that swooning sales and poor earnings would bring thousands of pink slips to associates and reconfigure management of the company.

Finally SOMEone with a conscience

Good news today from our beloved real superhero, President Obama--

Obama caps executive pay tied to bailout money

By JIM KUHNHENN, Associated Press Writer
44 mins ago

WASHINGTON – President Barack Obama on Wednesday imposed $500,000 caps on senior executive pay for the most distressed financial institutions receiving federal bailout money, saying Americans are upset with "executives being rewarded for failure."

Obama announced the dramatic new government intervention into corporate America at the White House, with Treasury Secretary Timothy Geithner at his side. The president said the executive-pay limits are a first step, to be followed by the unveiling next week of a sweeping new framework for spending what remains of the $700 billion financial industry bailout that Congress created last year.

The executive-pay move comes amid a national outcry over huge bonuses to executives heading companies seeking taxpayer dollars to remain afloat. The demand for limits was reinforced by revelations that Wall Street firms paid more than $18 billion in bonuses in 2008 even amid the economic downturn and the massive infusion of taxpayer dollars.

"This is America. We don't disparage wealth. We don't begrudge anybody for achieving success," Obama said. "But what gets people upset — and rightfully so — are executives being rewarded for failure. Especially when those rewards are subsidized by U.S. taxpayers."

The pay cap would apply to institutions that negotiate agreements with the Treasury Department for "exceptional assistance" in the future. The restriction would not apply to such firms as American International Group Inc., Bank of America Corp., and Citigroup Inc., that already have received such help.

"There is a deep sense across the country that those who were not ... responsible for this crisis are bearing a greater burden than those who were," Geithner said.

Firms that want to pay executives above the $500,000 threshold would have to use stock that could not be sold or liquidated until they pay back the government funds.

Generally healthy institutions would have more leeway. They also face the $500,000 limit if they're getting government help, but the cap can be waived with full public disclosure and a nonbinding shareholder vote.

Obama said that massive severance packages for executives who leave failing firms are also going to be eliminated. "We're taking the air out of golden parachutes," he said.

Other new requirements on "exceptional assistance" will include:
_The expansion to 20, from five, the number of executives who would face reduced bonuses and incentives if they are found to have knowingly provided inaccurate information related to company financial statements or performance measurements.
_An increase in the ban on golden parachutes from a firm's top five senior executives to its top 10. The next 25 would be prohibited from golden parachutes that exceed one year's compensation.
_A requirement that boards of directors adopt policies on spending such as corporate jets, renovations and entertainment.

The administration also will propose long-term compensation restrictions even for companies that don't receive government assistance, Obama said.
Those proposals include:
• Requiring top executives at financial institutions to hold stock for several years before they can cash out.
• Requiring nonbinding "say on pay" resolutions — that is, giving shareholders more say on executive compensation.
• A Treasury-sponsored conference on a long-term overhaul of executive compensation.

Top officials at companies that have received money from the government's Troubled Asset Relief Program already face some compensation limits.

And compensation experts in the private sector have warned that such an intrusion into the internal decisions of financial institutions could discourage participation in the rescue program and slow down the financial sector's recovery. They also argue that it could set a precedent for government regulation that undermines performance-based pay.
"It's not a government takeover," Obama stressed in an interview Tuesday with CNN. "Private enterprise will still be taking place. But people will be accountable and responsible."

Still, some elected officials were pushing for the stricter caps.

Sen. Claire McCaskill, D-Mo., has proposed that no employee of an institution that receives money under the $700 billion federal bailout can receive more than $400,000 in total compensation until it pays the money back. Her figure is equivalent to the salary of the president of the United States.

Even some Republicans, angered by company decisions to pay bonuses and buy airplanes while receiving government help, have few qualms about restrictions.

"In ordinary situations where the taxpayers' money is not involved, we shouldn't set executive pay," said Sen. Richard Shelby of Alabama, the top Republican on the Senate Banking Committee.

"But where you've got federal money involved, taxpayers' money involved, TARP money involved, and the way they have spent it, with no accountability, is getting close to being criminal."