Today in Madoff: The Senate Banking Committee Confronts the Elephant in the Room

For a lot of people, Bernie Madoff taketh away, but for the news cycle, he’s the gift that keeps on giving. After the jump, your Day in Madoff News.

• The Senate Banking Committee held a hearing today to look into how Madoff’s scheme was able to escape detection, and talk about what regulatory changes they might make to avoid such a ghastly fuckup in the future. Several expert witnesses were heard, but none were as gloriously descriptive as Senator Charles E. Schumer, who slayed the SEC and its chairman, Christopher Cox, with an awesome metaphor: It was like, he said, there was a giant elephant standing in a small room next to the SEC for decades and “not only did they not see the elephant, they didn’t even smell the peanuts on his breath.” [DealBook/NYT]

• Also, the SIPC said Madoff’s brokerage firm owed customers $600 million in stock it didn’t have on hand. [Bloomberg]

• Spain’s Banco Santander is offering a $1.8 billion settlement to its clients who lost money with Madoff, stepping up pressure on other banks and feeder funds to do so. [WSJ]

• Fashion fanatic Robert Jaffe will finally have to go to Massachusetts to meet with securities investigators there. [Bloomberg]

• Over at the Daily Beast, reporter Lucinda Franks, the wife of New York County District Attorney Robert Morgenthau, spoke to “key players” who believe Ruth Madoff may have played “a larger role than previously thought.” Oddly, said players speak kind of like gossipy old broads: “She’s there all the time and her husband just blows it by her? They are a really tight couple, did he really keep this secret from her every day of their marriage?” In her sourceless piece, Franks also relates that “a person close to the case” says Madoff has admitted to law enforcement that his Ponzi scheme began more than 40 years ago — “much earlier than previously believed.” [Daily Beast]

Today in Madoff: The Senate Banking Committee Confronts the Elephant in the Room