From behind bars, Bernard Madoff offers Wall Street commentary

NEW YORK -- He may be stuck in a federal prison for the rest of his life, but Bernard Madoff is nonetheless taking the time to muse on Wall Street topics of the day.

CNBC posted on its website a Dec. 24 email Madoff sent the financial news network as well as attorneys and academics who have been communicating with the notorious Ponzi scheme mastermind.

In the email, Madoff offered his thoughts on a range of issues -- including the stock market’s structure, hedge funds and insider trading.

Madoff, for example, said the federal government’s recent crackdown on insider trading wrongly feeds the impression that illegally trading stocks on non-public, material information is a new crime on Wall Street.

“This is false,” Madoff wrote. “It has been present in the market forever, but rarely been prosecuted.”


“The same can be said for front-running of orders,” he added, referring to the illegal practice of brokers trading ahead of their customers.

Madoff has apparently been staying on top of the news, too. He mentioned the recently announced acquisition of NYSE Euronext, operator of the New York Stock Exchange, while discussing the emergence of so-called dark pools. Those trading venues allow the buying and selling of large blocks of shares not available to the general public and occur off major exchanges.

“While I have always been an advocate of electronic trading due to the efficiency the lower costs they bring [to] the markets, I am [not] a fan of the lack of transparency the dark pools create,” he wrote.

Madoff has been serving a 150-year sentence after his massive fraud collapsed in late 2008. He once held an esteemed role on Wall Street and was a well-reputed market-maker, even serving as chairman of the Nasdaq.


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