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Intro: "Senior executives at JPMorgan Chase expressed serious doubts about the legitimacy of Bernard L. Madoff's investment business more than 18 months before his Ponzi scheme collapsed but continued to do business with him, according to internal bank documents made public in a lawsuit on Thursday."

Bernie Madoff is certainly not your typical crook. Until recently, he was a highly respected figure in the financial industry. (photo: File, unspecified)
Bernie Madoff is certainly not your typical crook. Until recently, he was a highly respected figure in the financial industry. (photo: File, unspecified)

JPMorgan Knowingly Invested in Madoff Ponzi Scheme

By Diana B. Henriques, The New York Times

03 February 11

Senior executives at JPMorgan Chase expressed serious doubts about the legitimacy of Bernard L. Madoff's investment business more than 18 months before his Ponzi scheme collapsed but continued to do business with him, according to internal bank documents made public in a lawsuit on Thursday.

On June 15, 2007, an obviously high-level risk management officer for Chase's investment bank sent a lunchtime e-mail to colleagues to report that another bank executive "just told me that there is a well-known cloud over the head of Madoff and that his returns are speculated to be part of a Ponzi scheme."

Even before that, a top private banking executive had been consistently steering clients away from investments linked to Mr. Madoff because his "Oz-like signals" were "too difficult to ignore." And the first Chase risk analyst to look at a Madoff feeder fund, in February 2006, reported to his superiors that its returns did not make sense because it did far better than the securities that were supposedly in its portfolio.

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+1 # robhood 2011-02-04 19:25
Of course Morgan bank knew. JP morgan was a criminal puppet of Rothschild. Even Rockefeller laughed after Morgan's death, and it was announced he only had a paltry 80 million dollars. Rockefeller commented that Morgan wasn't even a rich man.
 

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