Henry Blodget, the former star techstock analyst who knows a thing or two about investment fraud, posts an interesting insight to the Madoff affair on his Clusterstock blog.

"Specifically, we're hearing that the smart money KNEW Bernie had to be cheating, because the returns he was generating were impossibly good.  Many Wall Streeters suspected the wrong rigged game, though: They thought it was insider trading, not a Ponzi scheme. And here's the best part: That's why they invested with him."

With insider trading endemic, if not institutionalised, in the broking industry, the old adage, about thing looking too good to be true doesn't always apply. The regulators, bless 'em, have known this for years. A clean up is long overdue - and, please, no more industry bleating about regulatory overkill.