If it wasn't for Hurricane Wilma, Securities and Exchange Commission attorney Eric Swanson would have married someone other than the niece of Bernie Madoff.
Swanson was nearly hitched to another Washington, D.C., lawyer. But the October 2005 storm blew their Florida wedding plans away and led to a devastating breakup.
True love, as they say, finds destiny.
On Feb. 28, 2006, Swanson received an email from SEC Assistant Director John Nee.
The email said the agency's New York office was investigating a complaint from some whistle-blower named Harry Markopolos, who claimed Madoff was running "the biggest Ponzi scheme ever."
Swanson forwarded Nee's message to his boss, John McCarthy. Days later, he found himself falling for Madoff's niece, Shana.
Swanson knew Shana's father, Peter, served as chief compliance officer at Bernard L. Madoff Investment Securities LLC, because he had examined the firm.
From 2002 to 2005, Swanson also helped build a case against the National Stock Exchange, where Peter Madoff had served on the board of directors.
Swanson also knew Peter was Bernie's brother. And he'd likely heard other SEC attorneys describe Bernie Madoff as "powerful" and "well-connected."
Yet when investigators asked Swanson about the email accusing Madoff of running the "the biggest Ponzi scheme ever," he said he didn't remember it.
This is the kind of story that cements perceptions that everyone in Washington is in bed with everyone on Wall Street. Why is an SEC lawyer romancing a Ponzi schemer's niece?
Yet this affair isn't why the SEC failed to uncover one of the greatest frauds in history, according to the Office of the Inspector General.
On Friday, the agency released a 477-page report, concluding that the SEC's bumbling stemmed from myriad other sources of incompetence and dysfunction. So after suffering a few lurid headlines, Swanson is in the clear.
"The report speaks for itself," said Eric Starkman, a spokesman for Swanson and his wife.
The report also proves, once again, that true love can never be stopped -- particularly not by the SEC.
Swanson first met Shana in 2003 while performing an examination at her now notorious uncle's firm. He claims he didn't begin examining Shana until years later, being involved with other women.
It wasn't until March 3, 2006, that Swanson met Shana at a bar in Washington during a conference sponsored by the SEC.
"I found her to be a lot funnier than I had .. thought," Swanson told investigators. "I got the distinct sense that she was kind of flirting with me. .. I also felt like if I had wanted to take it further that night, I could have, but I didn't."
He said he didn't consider a romantic relationship with Shana inappropriate since he wasn't working on any Madoff-related investigations at the time.
Swanson's boss, McCarthy, found out about the affair, and wrote in an April 6, 2006, email: "I guess we won't be investigating Madoff anytime soon."
McCarthy, who had been a nurturing and paternalistic force in Swanson's life, told investigators this was just his way of expressing himself. He was upset about the relationship. But not because Shana worked at a registered broker dealer that the SEC was supposed to regulate. He just didn't like her.
During a trip to New York, Swanson asked McCarthy to go with him to a karaoke bar and meet Shana.
"The karaoke bar turned out to be a .. high-end strip club, and I was extremely upset," McCarthy told investigators. "They .. looked like they were having fun at my expense, so I think it became a big deal between Eric and myself."
Swanson continued to see Shana Madoff, but no longer discussed the relationship with McCarthy. He also began looking for a new job.
In July 2006, Swanson told Lori Richards, director of the SEC's Office of Compliance and Inspections, of his plans to leave the SEC.
"She is not happy abt [sic] me leaving and is trying to give me incentives to stay," Swanson wrote in a July 17, 2006, email to Shana. "She is v[e]ry happy about us, however."
Was anybody at the SEC concerned about regulators romancing the regulated?
Swanson left the SEC in September 2006. He married Shana on Sept. 29, 2007. Several of Swanson's SEC colleagues came to the wedding, including the once-disapproving McCarthy. And there was Bernie Madoff at the top of his game.
Nobody knew it then, but this wedding would be marked by a different sort of hurricane. Swanson told investigators he learned about Madoff's place in history from reading the newspaper:
"It was only after I, you know, started getting access to documents that had been leaked to the Wall Street Journal in the days and weeks after Bernie was arrested that I saw the full scope .. and I thought it's a major problem here."
Hmm. Ya, think?
The inspector general's report also had this to say:
"We conclude that Swanson's communication with .. Shana during the period of time he was engaged in a cause examination of her uncle and father's firm, created the appearance of a potential conflict of interest."
Hmm. Ya think?
Of course, love and destiny do not concern themselves with appearances. And neither does the SEC.
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