No One Would Listen: A True Financial Thriller

Written by Harry Markopolos

Narrated by Harry Markopolos, Scott Brick, Frank Casey and 4 more

No One Would Listen is now going paperback.  This is the story of Harry Markopolos, the whistleblower who discovered that crimes against investors were being committed by Bernie Madoff, whose Ponzi Scheme would ultimately become the biggest and longest-running financial investment fraud in history. Madoff's impact, both financially on individuals and institutions, continues to send shockwaves across the financial system and represents a major failure to investigate by the Securities and Exchange Commission (SEC), the nation's top market copy. The unraveling of the Madoff investment fund will go down as the crowning story of an era that has ended with the most troubled, turbulent, and uncertain global economy. How Madoff was enabled, by investors and fiduciaries alike, is nothing short of breath-taking and spell-binding. But how Madoff was allowed to operate by the SEC, despite repeated written and verbal warnings by whistleblower Harry Markopolos, is something that can only be told Harry himself and his team of financial sleuths.

• Language: English
• Publisher: Ascent Audio
• Release date: Jul 20, 2020
• ISBN: 9781469083636

Reviews for No One Would Listen

[omamogho · Rating: 5 out of 5 stars]

Very insightful into the workings and bureaucracy of US Regulators

[liscarey · Rating: 5 out of 5 stars]

In December 2008, Bernie Madoff, one of the most respected figures on Wall Street, co-founder and former president of NASDAQ, confessed to running the largest Ponzi scheme in history. On the heels of that revelation, we learned that this fraud had been going on for decades, and then that it was international in reach.

We also learned that there had been a whistleblower, who had warned the SEC a decade earlier, and when he was ignored had continued to investigate, and made additional filings, with additional and more complete information, including the growing size of the fraud.

That whistleblower was Harry Markopolos, and this is his story.
Markopolos was working in an investment firm as a quantitative analyst when a colleague mentioned Bernie Madoff and his unusually consistent and profitable returns on investments. They quickly concluded that Madoff's returns were impossible, and the only question was whether he was running a Ponzi scheme or engaging in "front trading"; using the information on stock trading available to him from his stockbroker business to do trades for his money management business beforehand, benefiting from the knowledge of the effect the other trades would have on the market.

Then they began to uncover the number of feeder funds channeling money into Madoff's care and management. At the time that Markopolos filed his first complaint with the SEC, he and his small crew of friends and helpers estimated the size of his "invested" funds at between three and seven billion dollars--an amount that would have moved the market if Madoff were really making those trades. By the time the 2008 financial crisis forced Madoff's Ponzi scheme into collapse, they estimated the size of his scheme at fifty billion dollars. What they didn't know until more and more of Madoff's victims came forward was that he was also accepting funds directly from individuals, and perhaps as much as $65 billion was involved, and perhaps as many as a million people around the world had suffered major losses, even the loss of everything they owned.

In crisp, clear terms, Markopolos tells the story of how he discovered Madoff's fraud, uncovered the size of it, and repeatedly tried to get the SEC to investigate and shut Madoff down. We see how many people had some understanding that Madoff's returns couldn't be real, but who ignored it because he was so respected, or so big, or, even worse, because his returns were so good. We see Markopolos' growing strain, eventually causing him to leave the financial industry and become a full-time fraud investigator, as well as the effects on the other members of his team. We also see the tragic effects on Madoff's victims and those in the industry who really believed that Madoff couldn't possibly be committing fraud.

Most importantly for the country as a whole, those of us who were not directly affected by Madoff's fraud, we see the incompetence and indolence of the SEC in the face of detailed, compelling, credible information that one of the major players on Wall Street was running a massive fraud. We thought the SEC was protecting us when we invested, and it wasn't. We were utterly without protection. New laws and regulations have been enacted, but there are efforts to roll those back, on the theory that the industry can regulate itself. The Madoff story, taken together with the other frauds, crimes, and reckless gambles that created the 2008 financial crisis and the current Great Recession, prove that it can't.

This is a moving, compelling story, but also an incredibly important one.

Highly recommended.

I borrowed this book from a friend.

[dougcornelius_1 · Rating: 2 out of 5 stars]

You can’t really criticize Harry Markopolos. He was right. He had spotted something wrong with Bernie Madoff years before the biggest Ponzi scheme collapsed. Unlike many others, Markopolos contacted the Securities and Exchange Commission about his suspicions. They ignored him. Markopolos went to the press, but no meaningful article came of it.When Madoff’s scheme collapsed and he turned himself in, Markopolos became lauded by the press, testified in Congress about the failings of the SEC, and was even offered the job of Chairman of the SEC by an ill-informed Congressman. No One Would Listen is another step in the Markopolos victory lap.He celebrates his brilliance in discovering the fraud and the incompetence of the SEC for not stopping it. He fills his attacks with similes:“His returns were as reliable as the swallow returning to Capistrano.”“As I continued examining the numbers, the problems with them began popping out as clearly as a red wagon in a field of snow.”Markopolos lays out how he first ran into Madoff and the years he spent trying to figure out how Madoff was generating his returns. Eventually, he came to the conclusion that he couldn’t do it. Since Madoff ran a big trading organization, he could have been front-running orders to generate illicit profits. Effectively, he would be stealing from his brokerage customers and giving it to his money management operations.The other likely possibility was that Madoff was making up his returns and using new funds coming in to redeem those leaving. Markopolos could not find any footprints of Madoff’s split-strike trading strategy. There didn’t seem to be enough options traded on the markets to support the amount Madoff had under management.I think it’s important to see why Markopolos was focused on Madoff. The principals at his firm wanted him to reverse engineer Madoff strategy so they could offer a similar product to their clients. Markopolos could not figure out how Madoff was generating his steady returns. He first contacted the SEC as a way to get his boss off his back. If he could prove Madoff was a fraud, his boss would quit demanding that Markopolos duplicate the Madoff strategy.Markopolos starts off No One Would Listen by stating that he made five separate submissions to the Securities and Exchange Commission over a nine-year period. So far, I’ve only seen one, his December 22, 2005 letter. Frankly, I found the letter to be a rambling, half-coherent diatribe. It was penned by a competitor who couldn’t figure out the trading strategy of the legendary Bernie Madoff, the founder of NASDAQ.As Chris MacDonald notes “Markopolos is a bit of a strange cat. He’s a likeable guy, and apparently a man of integrity, but also a bit paranoid-sounding.” (He had seen the new movie, Chasing Madoff, based on the book.)Clearly the SEC was unable to stop Madoff. Was it their fault? Yes. They relied on the well-established credentials of Madoff and dismissed the paranoid ramblings of an eccentric analyst. Markopolos’s barbs against the SEC are over-the-top and eventually got distracting. On top of that, I was often distracted by his misuse of “principle” instead of “principal” in the book. You would think that a financial analyst would know the difference.

[bookblotter · Rating: 4 out of 5 stars]

Strangely, I've done a few reviews at LT and never before had the conscious feeling while reading the book of thinking about reviewing and rating it. I was pretty well aware of the Bernie Madoff story and how Harry Markopolos fit into it before I read the book.While reading the book I thought that it could have been shorter and a bit less repetitive (the material about fearing for his life, e.g.). I also had a mental image of SEC people reacting to Markopolos personally in a negative manner. Markopolos may well be a nice guy but I'd bet that he was very intense; I would have been considering the circumstances. The book wasn't particularly well written and could have used a good editor.All that said, the story is an extremely important one. The folly at the SEC is deserving of study and contemplation of their ineptness and corrective action. The gullibility of investors was extreme and the general acceptance of stuff at face value from someone belonging to the same group as the investor (religious, ethnic, geographic, etc) astounds me and seems to happen regularly, although not in this scale.Bottom line, the story is a five, the writing is a two, so the difference is split. If you are in the financial arena or a trusting soul with regard to financial matters that matter to you, read the book. A smattering of cynicism is a good thing.

[jcvogan1 · Rating: 2 out of 5 stars]

Guy is nuts, but his diagnosis is not that far off base.

[ibeth_2 · Rating: 4 out of 5 stars]

Markopolos suggests that the SEC ignored his warnings in part because they didn't like him. After reading his book, I agree with that assessment. Markopolos does sound like a dick. But he also gave some easy ways to check whether his accusations were right. For example, the SEC (or investors, or anyone familiar with the markets) could have compared the fund statements Madoff produced to actual trading records to see if trades actually happened. The SEC debated doing just that, but decided it would take too long, so they relied instead on Madoff's words and his track record. A shocking lapse, with tragic results. Anyway, although Markopolos isn't all that likable, his book sure is entertaining.

[dudara_2 · Rating: 5 out of 5 stars]

Bernie Madoff has gone down in the history as the man behind the world's largest known Ponzi scheme. When his scheme collapsed following the market crisis of 2008, hundreds of investors lost their savings with the total loss estimated at being in excess of $50 billion. The truly shocking part of this story is that this terrible loss could have been mitigated - if the Securities Exchange Commission had heeded the warnings of Harry Markopolos. In the years preceding the collapse, Markopolos had filed no fewer than 5 complaints against Madoff, all of which had been lost or ignored by the SEC watchdog. It is tragic to read of Markopolos' repeated efforts to bring this to the attention of the authorities and the mind boggles at how all these red flags could have been ignored.Markopolos does tell an intriguing and well-written story. However, I must admit that it is rare to read a book where I've actively disliked the author. Markopolos has a strong character (stubbornness is especially obvious) and I can see how individuals in authority might have taken a dislike to this man. But when fraud on such a massive scale is being alleged, personal likes and dislikes should not come into the picture.Markopolos' revelations led to him testifying in front of government and has triggered a review of staffing and procedures at the SEC. His work has led to significant change and it cannot be underestimated. Read this story and marvel at a tale of ineptitude and dedication.

[electricray · Rating: 4 out of 5 stars]

Cassandra was a beautiful Trojan princess who Apollo blessed with powers of clairvoyance but, when she rebuffed him, he cursed her by ensuring no-one would believe anything she said. Thus, her admonitions about the fall of Troy (it may have been she who warned "beware of Greeks bearing gifts") fell on deaf ears and, as Wikipedia beautifully puts it, her "combination of deep understanding and powerlessness exemplify the tragic condition of humankind". I dare say Harry Markopolos, the Boston quant who repeatedly alerted authorities to Bernie Madoff's Ponzi scheme for almost a decade before it finally fire-balled, knows how Cassandra felt. This is his recounting of his whole grisly story. At that level, this is a fascinating account of a genuinely Greek tragedy - irony intended - which contains exactly the elements of Cassandra's tale (except, perhaps, the unbearable beauty: the author's publicity photos capture an ungainly, if not altogether unlikely, figure doing his best to look resolute and loyal in front of the Stars and Stripes). Harry Markopolos was possessed not just of vague discomforts that, after the event, a know-it-all windbag might use to claim fore-knowledge: quite to the contrary, he identified, in gruesome and glaring detail, that Bernie Madoff was necessarily running a Ponzi scheme, precisely why, precisely how, helpfully suggested some precise and simple measures by which an investigating authority could cheaply verify his allegations (as simple as "ask to see his transaction confirmations"), and he sent this, in writing, to the Securities and Exchange Commission about five times over the course of a decade. That is remarkable enough a story, and Mr. Markopolos deserves your money to tell his story for that service alone. While we might shake our heads in wonder at how this could happen, we also might harbour some suspicions: Markopolos was from an unfashionable firm based in unfashionable Boston under the jurisdiction of the unfashionable Boston branch of the SEC; he seems an unfashionable chap prone to unfashionable conspiracy theory: none of this can have helped his credibility. But neither that nor the fact that the SEC is understaffed, underskilled and over-populated with financially illiterate lawyers (all certainly true) comes close to explaining why Markopolos' warnings were systematically ignored. If you read Markopolos' submission to the SEC from 2005, which is appended to the text, you will recognise that one didn't need to be an expert on split-strike conversion strategies to understand something must have been dreadfully wrong with Madoff's operation. Yet while these shortcomings are not good answers, they are the best Markopolos can offer (and, in from position, can be expected to offer). For all the studied outrage he marshals (if ever there were a dictionary definition of "studied outrage" this is it) throughout this entertaining and readable book, Markopolos seems satisfied this is just a case of good, old-fashioned, thorough incompetence. The system itself is conceptually ok; it's just some significant parts of it (such as the SEC) happened not to be fit for purpose. Hire a few more financially literate analysts, and fire a few lawyers, and all will be well. That doesn't sound like a plausible answer to me. Anomalies, in the sense depicted in scientific literature, are fleeting imbalances; momentary disruptions in the established order of things which are gone so quickly so as to not be reliably measurable, and thus incapable of falsifying existing orthodoxy. Anomalies are the sort of things that are characterised by platitudes such as "stuff happens" or "the exception that proves the rule". A fifteen-year, 50 billion dollar fraud involving one of the most respected men in the industry, publicly trailed by magazine articles and a privately prosecuted by the concerted, detailed, and relentless efforts of a small group of professionals is no such anomaly. It simply isn't credible to put this down to an unfortunate confluence of improbable human errors. The collective failure to see Madoff for what he was feels like a symptom of something much wider and more fundamental. That feeling is augmented by other recent "anomalies": Nick Leeson; Long Term Capital Management; Enron; Amaranth; the Dot-Com bust; Jerome Kerviel; Lehman; AIG. By and large these anomalies went on, in full public view, for years. Are these really anomalies? That, in the vernacular, is the elephant in the room. In focussing on the minutiae of the Madoff investigation - and you can't really blame Markopolos for doing that; it's what he knows - "No-one Would Listen" doesn't ask, let alone answer, that important question: what is it structurally, systemically, even sociologically about our financial system that can allow these "anomalies" to happen for more than an instant? That they can recur suggests strongly that we have a paradigm in crisis; that something about our set of assumptions and parameters; something really fundamental about the way we we currently, collectively look at the financial world, is utterly misconceived. The book that identifies this error, sure to be a ground shaker, is yet to be written. This one simply entertains. Markopolos is particularly scathing of the SEC. Its astoundingly poorly judged appearance before Congress, in which its general counsel attempted to plead executive immunity - from having to testify before a branch of the executive - must be seen to be believed (and can be, on YouTube). Yet underlying the solid good sense and analysis lurks a grandstanding conspiracy theorist and this does undermine his credibility to some extent. Markopolos repeatedly mentions checking beneath his car for explosives, the risk he took from organised crime and terrorist cells who might have invested in Madoff (none has been reported, and while I guess you wouldn't expect it, it still doesn't make Markopolos' allegation justified). That said, this book is worth your time and money to read, if nothing else as a salutary lesson.

[miro_4 · Rating: 4 out of 5 stars]

An interesting book in which a group of financial derivatives specialists centred around Harry Markopolos stumbled in the fact that the Madoff company must be falsifying performance data on their investment fund.Markopolos raised a series of red flags in a detailed 2005 submission to the S.E.C. (Securities and Exchange Commission) strongly suggesting that Madoff Securities was a Ponzi scheme, and continued to visit and make submissions to them until all it would have required on their part would have been a few telephone calls and half an hour on a Bloomberg terminal. However, they resolutely refused to investigate while investors lost a further $40 billion because the SEC staff of lawyers and recent graduates lacked the experience or training to investigate financial crime.A few institutional investors did complete due diligence on Madoff and decided not to place money with him. Caveat Emptor.

[urquhart_1 · Rating: 4 out of 5 stars]

An engrossing read by the guy who discovered Madoff back in 1999 and for whom he became a ten year obsession.

[cyclingleft · Rating: 4 out of 5 stars]

Good first person account by the quant who identified Bernie Madoff's ponzi scheme in 1999 and his attempts to get the SEC to act. He exposes the SEC as an ineffective watchdog agency that had it acted in shutting Madoff down in 1999 could have prevented at least the $43 billion that was invested between 1999 and 2008 when Madoff turned himself in.