Even after Madoff, Ponzi Schemes Touting Promissory Notes Proliferate

By Pam Martens and Russ Martens: June 11, 2018 ~   Most Americans are not aware that the Securities and Exchange Commission (SEC) had the opportunity to stop Bernie Madoff’s Ponzi scheme 16 years before he confessed in 2008. In 1992, the SEC settled an investigation against two Florida accountants, Frank Avellino and Michael Bienes. The duo had been raising money for Bernie Madoff to “invest” for their clients for 30 years by handing out promissory notes to investors that promised returns of 13.5 percent or higher. Avellino and Bienes sold over $440 million in these unregistered notes to thousands of unwitting investors. The Avellino and Bienes matter was settled by the SEC with an order for the accountants to stop selling unregistered securities and with Madoff returning the money. No inquiry was made into where Madoff obtained the funds to pay back investors. The SEC did not lay a finger on … Continue reading