“Young miss, Arthur Andersen... isn’t that one of the Big Five accounting firms? If they were the ones overseeing the books, there’s no way they wouldn’t have noticed the Ponzi scheme... I think.”
Ha Yeong-il cautiously raised the question.
He was basically saying, Am I the only one hearing this wrong...?
But this time, I was the one mistaken. I should’ve said, I was right again this time, but...
“Yeah. If they’d looked properly, even they would’ve seen it.”
I stood on the balcony of my residence in America, gazing out the window. The meeting had ended, and a golden twilight had settled over the horizon.
“...Are you saying... that Arthur Andersen didn’t actually look at the books?”
I broke into a sweat at those words.
I still didn’t fully grasp it.
Was it just coincidence, or was part of it deliberate...?
One of the leading accounting firms in the United States. Even now, after shifting toward consulting, it’s still # Nоvеlight # considered top-tier on the financial side.
But far from preventing accounting fraud, it later came to light that they’d outright enabled it—within ten years, the company would collapse completely.
That’s why things were now confusing. Was Madoff using them while knowing about their falsifications... or was he just borrowing their name for legitimacy?
If it’s the latter, Arthur Andersen probably signed off on fake reports without even checking. That would still be fraud, but something we could plausibly deny.
But if they were fully complicit and actually manipulating the books—that changed everything. That meant they were trying to cover for a Ponzi scheme so colossal they couldn’t just report it, and now they were going to push through the fraud no matter what.
They’d have to be insane not to realize the scale of this scam. But since these were people who had let similar schemes slide in my past life...
“Whew, I’ll go check it myself. Back to New York... Let’s go. Been a while since I traveled.”
A flood of documents had arrived from Madoff. They looked entirely normal at a glance—statements, performance reports, even confirmation stamps from Arthur Andersen.
At first glance, everything looked fine.
But I was going there to see for myself.
Wall Street, Bernard L. Madoff Investment Securities.
“Hurry, move the files!”
“Oh, they’re coming? Right now?”
“Yes! This... Do we have backups in other offices? Shred anything that’s duplicated. Originals—stash them all in that box over there!”
Employees, faces full of panic, darted about hiding documents. It was because a contact had warned them the audit team was en route—at the worst possible timing, as if this moment had been anticipated.
“Damn, how did they know to come right now...?”
There wasn’t even time to organize the papers. They moved frantically, like they knew exactly when the 300 million would be triggered.
In truth, ever since I made that proposal, they must have been ready for the axe to fall at any moment.
Compared to Alpha Fund, which spared no effort in ambushing competitors, these guys were like amateurs. Unworthy of being called rivals in the same field.
If there was one saving grace, it was that they had at least prepared in advance.
Madoff likely didn’t expect this farce to drag on forever. That’s why he never bothered with emergency safety systems .
My heart was pounding. How anxious must I have been—one of the staff who’d been waiting near the front entrance burst in, breathless.
“Wow, they’re here! The audit team is in the parking lot right now...”
“Drop everything and pack the documents!”
Someone shouted through gritted teeth.
No matter what, nothing must be leaked. If they caught any dirt, the name value of the fund would plummet.
And if anything were to be exposed...
Ha Yeong-il, director of Alpha Fund, stepped into the Madoff Fund office with a businesslike smile. Madoff, drenched in cold sweat, forced a smile back.
‘He may be called a director, but rumor has it he’s an MD—Managing Director... Definitely not a lightweight.’
Considering there’s nothing above MD at Alpha Fund except the official CEO, it was safe to say he was one of its top leaders.
One of the highest-performing fund managers on Wall Street in recent years... So of course, Madoff wouldn’t be careless. He had prepared for this meticulously.
Time was short... but fortunately, Arthur Andersen handled that part well.
“Hm, as expected of a fund with a long-standing prestigious name. The building’s interior is excellent. Our fund might need to upgrade some furniture too...”
“Where’s the money being managed from...? JP Morgan, maybe...? Let’s see... Hm, BBB? That’s decent. The naming sense is awful though. Still, compared to Alpha Fund, I’d say your name doesn’t stand out much either? Ah, just saying.”
Ha Yeong-il chatted while leisurely strolling around the building, feigning nonchalance.
“So he’s naturally trying to steer us toward wherever the secret documents are hidden...”
Madoff cautiously listened to those words and guided him away from the more sensitive areas. To where the most critical documents weren’t stored.
“Haha, take your time looking. Ah, the ones assigned from the accounting firm... my staff will guide them.”
Fortunately for him, Ha Yeong-il's staff were technically from a different affiliation. As a known competitor, Ha Yeong-il didn’t have sweeping authority within Madoff Fund.
Everything Ha Yeong-il was permitted to see was only the kind of content any institutional investor could normally access.
The foundation investors didn’t send Ha Yeong-il without reason. They judged that this level of check was sufficient. Though the nature of a Ponzi scheme meant that even such a surface-level audit could sometimes expose flaws.
“Hm... No issues here.”
“This side seems a bit sloppier. Maybe it was done in a rush, but the stock trade records here have some gaps. Especially for options and derivatives—it feels like some of the short positions weren’t logged properly...”
“Hm, this is odd... Could it be that other sections weren’t audited? The filing is strange—it’s hard to trace anything...”
One of the accountants flipping through folders asked. A staff member replied, sweating nervously:
“Ah, yes. It’s rare for auditors to check this deep inside the fund... I’m very sorry!”
Though he remained expressionless, he turned his head slightly and muttered:
“Well, that happens. They probably just received the documents and checked them off... That kind of thing’s been common lately. Still, we’ll be thorough.”
The accountants casually flipped through the documents and began comparing figures.
It was all within expectations. Yes, it looked normal on the surface.
The problem was... as I’ve said many times before, a Ponzi scheme is built in such a way that everything looks normal under audit!
“It’s fine. It’ll pass. It’ll pass...”
Arthur Andersen’s audit was flawed. There were some areas they could nitpick, but nothing that would clearly expose the scale of the fund’s internal fraud.
Set up a shell company, invest through it, then claim returns via stock trades... Reporting profits from that, rerouting funds across multiple entities—it was a seamless maze. And in that maze, it was nearly impossible to identify a single unbroken chain that led to a fraud.
And the accountants were all already in on it.
"What if... what if the fund really did invest in those companies, and they were all properly recorded in the reports? Wouldn’t that mean someone could go through every one of them and cross-check everything?"
“Wait, all of them...?”
Calling it “all of them” felt off. Was it really certain that every accounting firm was gathered here?
Feeling something was wrong, Madoff asked Ha Yeong-il,
“By the way... where did the young lady who was next to you go? She seemed quite close to you...”
That nondescript client named Yoo Ha-yeon. That sly woman who alone managed to gather $10 million in donations just during the charity auction.
Ordinarily, there would be no reason to suspect her. She hadn’t been listed as part of the audit team. But with the authority of a director, one person accompanying was possible...
Madoff’s instincts were on high alert. Something was definitely wrong.
“Something’s not right...”
As if—yes, as if time were being deliberately dragged out.
But why? What could they possibly gain by stalling for time here?
“Oh, that person? She’s currently elsewhere. She said she needed to check another accounting firm... so she went.”
“Oh, you mean Arthur Andersen?”
Ha Yeong-il gave a tight-lipped smile and confirmed it.
“No, not them. She meant the previous accounting firm. Specifically, the one in New York City... a very small office.”
An accounting firm that no one had even heard of...
A firm that looked suspicious to anyone who saw it.
Ah, so this is where it was.
“Guys, load everything here onto the truck.”
People hurried into the now-cleared office.
Wearing tightly fitted black dress pants, I had my leg propped up on the table. At the tip of my outstretched leg was a men’s dress shoe, tapping.
Both of my hands were stuck in my trouser pockets, and the pale-faced accountant flinched at the sight of me.
Adjusting his necktie, I flashed a bright smile and asked:
“So... now answer me. How exactly did just one person like you manage to audit a fund worth over five billion dollars?”