As Merritt Maxim of CA points out, Madoff Scheme Highlights Need for Impartial CCO, one of the biggest red flags in the Madoff scandal was that was the disclosure that Madoff’s brother Peter served as the firm’s Chief Compliance Officer.
“While having any sibling or family member serve as a CCO should not be an immediate cause for concern, the results of the Madoff scheme indicate that the only CCO who could have enabled the Madoff scam to persist was someone who was either:
A) Related to Bernard Madoff
B) Complicit in the fraud
C) Did not adequately fulfill their responsibilities as a CCO or
D) All of the Above.”