What a great country America is. Consider one Daniel Sadek, a pathetic bearded 30s-something punk with a third-grade education. Nonetheless, Sadek's perspicacity fathomed a way to join his peers who were turning $5000 a week selling sub-prime (we should say sub-sub-prime) mortgages to over-eager would-be homeowners in southern California. Sadek the opportunist turned hundreds of millions of dollars in no time with his mortgage-for-free gambit.
Now consider Bernard Madoff. A reprobate Charles Ponzi would be proud of, outwardly respectable Bernie rubbed shoulders with the best on Wall Street, even as he leveraged his clever $50 billion accounting schemes. His standing in the New York financial community included positions on elite commissions and securities boards. The well-educated scoundrel even held a coveted seat on the Nasdaq stock exchange. Madoff bought the whole enchilada.
Sadek, on the other hand, started out as a two-bit used car salesman. Drifting from car lot to car lot, he wound up selling expensive Mercedes Benz automobiles to youthful mortgage marketeers. He saw how uneducated salesmen could sell mortgages like hot dogs at a ballgame, and then buy pricey imported automobiles.
Like Madoff, Sadek decided he wanted to drive Mercedes Benz cars and have golden enchiladas for supper, too. So, he quit car sales and founded Quick Loan Funding, a mortgage company eager to dish out loans to virtually anyone who walked through their doors. Quick Loan would write mortgage loans regardless of whether borrowers had credit, poor credit, or no credit. It worked because Wall Street firms bought as many mortgage loans as Sadek could deliver.
I don’t suppose either Sadek or Madoff envisioned the day the tables would turn. But, we all know there’s an old adage that says what goes up must come down. Real estate values are now plummeting, and unemployment is skyrocketing. Homeowners can't refinance because their homes aren't worth as much as they were a few months ago. People are defaulting and banks are foreclosing left and right, to the tune of 10,000 a week. The losses measure in the trillions of dollars.
Uh oh. Belly-up time came all too soon for Quick Loan. Sadek now owes money to county collectors, Wall Street banks, and billionaire funders. He also owes more than $88,000 in property taxes for a number of palatial houses, and he owes $44,000 in leased equipment taxes.
As if that wasn't a headache, Wells Fargo is suing Sadek to recover a half million dollars he borrowed on his personal line of shaky credit. Sadek also owes nearly $8 million to other lenders. Oh yes, he also spent $30 million producing a quasi porno flick that netted only $7 million at the box office.
The Spider And The FlyAs for the firm of Bernard L. Madoff Investment Securities, it managed
billions over many years for individuals, exalted foundations, universities, and the like, enticing them into Madoff’s white-collar Ponzi scheme with impunity. Leveraging Nasdaq and its on-line technology, nefarious and complex dealings trumped venerable Big Board financial firms steeped in doing business the old fashioned John Huston way.
What a picture of swashbuckling greed. Both of these men created chaos in the worldwide financial system. They are truly twenty-first century scoundrels.
America, Land of The Free, eh? Yeah. A free for all.
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