Those of us who already miss Jay Leno’s old “Jaywalking” segments on the Tonight Show shouldn’t be surprised that a lot of people just aren’t aware of what most of us would consider “common knowledge,” but a new survey demonstrates once again that you can never be too sure about your assumptions.
The audit confirmation service Confirmation.com has just come out with the results of a new poll in which it asked a group of college-educated investors if they have ever heard of the Bernard Madoff fraud, and over a quarter of them didn’t. Specifically, 27 percent of the individuals with a college education who invest in the stock market were not able to identify Bernard L. Madoff Investment Securities LLC as the perpetrator of a stock market fraud. Perhaps it was the wording of the question that puzzled them, since most folks associate Madoff with Ponzi schemes, and the full name of his securities firm may not have set off any alarm bells with some of them. Still, that’s a dismaying result.
Roughly a third of respondents between the ages of 30 to 44 could not identify the Madoff fraud, although 66 percent could. And nearly half of respondents between the ages of 18 and 29 could not make the identification either, while 56 percent of them did. Nearly a third of those between the ages of 45 to 60 failed to identify Madoff (though 71 percent did). Those over the age of 60 showed greater awareness, with 80 percent of respondents identifying Madoff. Wisdom really does come with age, especially if you can count yourself as one of Bernie Madoff’s unfortunate investors.
Despite the disappointing signs in the survey, a majority of investors believe there should be increased regulatory oversight in the financial services space. The Confirmation.com poll found that 80 percent of investors believe that all companies listed on a U.S. stock exchange should have the same amount of regulatory oversight. A significant share of them, 89 percent, believes that regulators should have equal access to inspect all companies on a U.S. stock exchange. Fourteen percent of the poll respondents incorrectly believe that “stocks and bonds” are covered by FDIC insurance. If only.
“The Madoff fraud should be on the mind of every investor,” said Brian Fox, president of Confirmation.com, in a statement. “Clearly, there needs to be a greater sense of awareness, so that frauds of this scale can be prevented in the future. The irony is that investors want and deserve more protection of their investments. That’s a commendable goal, but without basic education, these investors will still be at risk, even with stronger protections in place.”