Explanation:
One of the most significant red flags in the Bernie Madoff Ponzi scheme was his extreme secrecy. He consistently refused to provide detailed, verifiable portfolio information or allow independent audits of his trades. This lack of transparency prevented investors and regulators from verifying whether the purported trading strategies were actually being executed or if the assets existed at all.
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Q.31 In the Bernie Madoff fraud case study, which of the following actions was a significant red flag that contributed to the ultimate discovery of the Ponzi scheme?
A
High-frequency trading activity.
B
Madoff's refusal to provide detailed portfolio information.
C
An unusually high volume of international investments.
D
Frequent changes in the company's legal counsel.
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