How many more Bernie Madoff's are there?

[toshj]

Thanks for the info - very interesting. I suppose they covered their asses a long time ago by ensuring that they were operating in a legal (legislation-wise) safe-zone.

Looks like the crisis has provided them a nice reason to re-organise, and of course, no guarantee that in the competition to flip the greatest profits, they will not resort to similar tactics in the future - undoubtedly in some kind of financial buzz-word laden form of strategy.

Yep. Pretty much. So in the case of RBS: in 2006 they hired a Cash CDO structuring team from Citigroup in London, this team would sit in their Credit and Equity business and focus on both working with the structured credit trading team, and also the external institutional client base.

This Cash CDO business ultimately failed due to the crash, but they then moved Credit Structuring into a FICC Solutions business, which also structured products across Interest Rate Derivaitves, Foreign Exchange Derivatives, Commodity Derivatives and other Regulator Capital Solutions. Therefore their structurers essentially became multi-asset structurers. The RBS Interest Rate Solutions business quickly became the most profitable Interest Rate Solutions business globally.

So despite losing a killing on structured credit, purchasing ABN Amro and other dodgy approaches, the guys at RBS GBM are still capable of producing some of the strongest practices within Investment Banking.