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Whistleblower: Frank Casey, Investment Expert Who Helped Uncover Madoff Scam, to Speak at Juniata

(Posted February 1, 2010)

Frank Casey

HUNTINGDON, Pa. -- Frank Casey, one of the investment analysts who tried to unmask financial investor Bernard Madoff as a fraud almost a decade before the infamous financier's eventual downfall will speak at Juniata College on what investors and others can learn from the scandal at 8 p.m., Tuesday, Feb. 9 in Neff Lecture Hall in the von Liebig Center for Science.

The lecture is free and open to the public.

Casey, now a hedge-fund consultant for the Fortune Group, will talk on "Lessons from the Madoff Fraud," explaining how he, and two other financial analysts, alerted the Securities and Exchange Commission, only to have the agency ignore the problem.

Most of the financial world professed surprise when the illegal financial empire created by Bernie Madoff crumbled (resulting in the loss of $50 billion) in the recent financial crisis brought on by reckless strategies by investment banks, insurance companies and other businesses. Casey identified Madoff's firm as a pyramid or "Ponzi" scheme in 1999, almost ten years before the scam was discovered by authorities. A pyramid scheme is a fraudulent investment operation where investors are paid returns from their own money or from money paid by later investors.

Casey came upon the fraud as an equity options specialist manager for Ramparts Investments, a firm he joined in 1998. One of his first projects for the firm was to create a complex financial product that would produce 12 percent net returns every year and guarantee returns of the investor's capital investment. In researching the feasibility of such a product, he found only one investment manager able to produce such returns: Bernard Madoff.

Casey identified Madoff's firm as a pyramid or "Ponzi" scheme in 1999, almost ten years before the scam was discovered by authorities. A pyramid scheme is a fraudulent investment operation where investors are paid returns from their own money or from money paid by later investors.

Together with two other Ramparts portfolio managers, Harry Markopolos and Neil Chelo, Casey realized that just one person creating such returns was indicative of a fraud and turned over their case against the investment company in early 2000. Casey also worked with investigative financial reporter Mike Ocrant to expose the fraud, but the SEC declined to act even after the publication of the investigative series.

Casey left Ramparts in 2001, and while Markopolos and Chelo continued to push for investigation at Ramparts, Casey contributed to their efforts by discovering that Madoff was accepting highly leveraged client investments and seeking loans from European banks.

Casey joined Fortune Group in 2008 as President-USA in charge of North American strategic joint ventures for customized hedge fund portfolio management solutions for private wealth management groups, family offices, and institutions.

Casey entered the business world shortly after leaving in the U.S. Army in 1974. He began his career as a financial analyst for Merrill Lynch and worked at Prudential Securities from 1982 to 1992. He formed his own investment management firm in 1992 and joined ramparts in 1998.

He also has a busy schedule as a speaker to both the financial industry and university ethics centers on how the Madoff fraud unveiled financial industry due-diligence failures, regulatory incompetence and the need to set a higher benchmark of ethical standard in business and law.

For more information on Frank Casey, please visit www.Apbspeakers.com.


Contact John Wall at wallj@juniata.edu or (814) 641-3132 for more information.