The Underlying Human Element | Harry Markopolos, 2010

 Harry Markopolos 

“Certainly one of the most important things I learned is that numbers can be deceiving.
There is a logic to mathematics, but there is also the underlying human element that must
be considered. Numbers can't lie, but the people who create those numbers can and do. As
so many people have learned, forgetting to include human nature in an equation can
be devastating.” 

“ Securities and Exchange Commission audits consisted primarily of confirming that a
checklist of documents existed, not necessarily that these documents were accurate,
 not even that they reflected real trades—just that you had the proper papers in your files.” 

“Ponzi schemes exist in stable disequilibrium. This means that while they can’t ultimately
 succeed, they can persist indefinitely—until they don’t.” 

“Most lawyers couldn’t recognize a Ponzi scheme if they were
having dinner with Charles Ponzi.” 


“These guys, they work for five years at the Commission, then they become a compliance
manager at a hedge fund.” And, he added, he knew that was true because every time an SEC
 investigator came up to his office he or she would ask for an employment application.” 

“Forgetting to include human nature in an equation can be devastating.”  

“The health care industry makes Wall Street look honest. It’s a $2-trillion-a-year business
with no controls and with limited auditing. On Wall Street the crooks at least have the decency
 to try to hide their frauds, but those people cheating Medicare don’t even bother doing that.
Wall Street is only taking your life savings, but in health care they may be stealing your life.
I was surprised to discover how little “care” there is in health care.” 

“I believe half of what they teach students will be obsolete within five years and
the other half is just outright false.” 

“Every mathematician loves the hunt for the sour numbers in an equation.” 

Harry Markopolos, No One Would Listen: A True Financial Thriller, 2010 

 and corruption.

are the source of funds.

Harry Markopolos

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