News Flash: FBI Finally Notices Fraud, Launches PR Blitz

"Operation Broken Trust". It sounds like the sort of thing that we would have come up with as the name of a major offensive in the Indian Wars of the 19th Century, but it's the name of a series of "...criminal and civil enforcement actions that occurred from August 16 through December 1, 2010". The purpose?

To root out and expose massive investment fraud scams across the nation; and
To alert the public about many phony investment scams.

And why did they do it? Well, because

The FBI has observed a steady increase in investment frauds, in particular Ponzi and market manipulation schemes. Since January 2009, we’ve opened more than 200 Ponzi cases, many with $20 million-plus losses. Based on our current caseload, the top five Ponzi scheme hot spots in the country are Los Angeles, New York, Dallas, Salt Lake City, and San Francisco, but keep in mind that these scams can and do happen anywhere.

While I don't really need the FBI on my case, what with Homeland Security already watching my blog, let's be honest here. There was a whistleblower trying to deliver Bernie Madoff to the SEC back in 2000. The Inspector General of the SEC has repeatedly hammered the SEC for its failure to actually act on findings of Ponzi schemes and other frauds, even when its own investigators are the ones who brought the information to light.

So sure, the FBI now has 231 cases involving 120,000 victims and $8 billion in losses. Good for them. I'm sure that the SEC and our other regulatory agencies are really appreciating the FBI for providing the government with the appearance of giving a damn.

Maybe "Operation Broken Trust Two" will go after the SEC regulators, and the attorney generals, and everyone else that knew this was going on and stood back and willfully allowed it to happen.

But I'm not holding my breath for that.