Investors:Where there's smoke, there's fire. Click link to read my column.

If most of the financial meltdown of 2008 was driven by the collapse of complexity in global finance, Bernie Madoff was the absolute exception. There were no credit default swaps, complex options or asset backed commercial paper in Bernie’s investment arsenal. There was no fund either. With at least US$40 billion, Madoff’s “fund” somehow never managed to be anything more than a Chase Manhattan bank account. 

From a Caribbean point of view there is one common irony in the stories of Bernie Madoff, Allen Stanford and Lawrence Duprey’s Clico’s Much of the intrigue around this threesome has been built around their self-styled success. Ultimately, the thing which attracted the most scrutiny was neither their characters nor evident success; it’s their core business which over the years, seemed to attract persistent questions. All three had the penchant for the jet setting lifestyles of successful industrialists but the hard facts surrounding their core business suggested that danger was coming. 

The lesson to be learnt is that if investors pay attention to the smoke they may be prepared for the fire. 

Click the link above to read the Newsday column.