For any investors considering whether to join-in the action against the SEC by KLS, and protect their future rights to sue the SEC, Here are a couple of articles that have been in the media relating to Dr Kachroo and the work she has already done for the Madoff Victims. I hope you find them helpful in deciding whether this action is best for you or not:
The following story “The Whistleblower’s Lawyer,” appeared in the Summer 2009 Harvard Law Bulletin.
Gaytri Kachroo S.J.D. ’02 was preparing to fly to India for business when she got a call that thrust her into the midst of one of the largest financial stories of our time. The caller was her client Harry Markopolos, an independent fraud investigator who, in the ensuing 24 hours, would go from being an unknown Chicken Little to a national hero.
Markopolos had spent almost 10 years trying to convince federal regulators that the Wall Street wonder Bernard Madoff was running the largest Ponzi scheme in U.S. history—a $65 billion investment fraud that would spell financial ruin for thousands of individuals, charitable organizations and investment groups.
When he called Kachroo on the night of Dec. 11, Markopolos told her that Madoff had just confessed and that The Wall Street Journal would be breaking the story in the morning edition. He wanted her to advise and represent him.
It was quite a request, given that until that moment, Kachroo knew next to nothing about her client’s investigation of the Madoff affair and had no experience with the press. A transactional lawyer who now specializes in emerging markets in India and Southeast Asia, she had been representing Markopolos since he began his fraud investigation business in 2004, and she had developed a strong bond with him based on their shared belief that you don’t have to compromise your ideals to succeed.
When the story broke on Dec. 12, her client was flooded with requests from media around the world.
“I was a little overwhelmed initially,” said Kachroo, a partner at McCarter & English in Boston. “We were deluged with calls from CBS, ABC, NBC, CNN, The Wall Street Journal, and I was on the phone daily from Pune [India] with congressional counsel and SEC Inspector General David Kotz. I had to get up to speed in a hurry.”
Kachroo knew that all of their preparation in the coming weeks was leading up to the moment when Markopolos would testify before Congress. She worked with him on what names he could include without exposing himself to liability and pressed him on what he knew for certain from his own evidence as opposed to what he assumed based on information from others.
“I was asking Harry constantly what he really knew, not just what he thought, and I asked him to base his opinions solely on that,” Kachroo said. “This provided testimony that was palpably Harry’s own and something the public could identify with.”
The media were smitten by the image of Markopolos as a modern-day Cassandra, hounding federal regulators for nearly a decade to consider his evidence that Madoff was a fraud. Despite numerous letters from Markopolos culminating in a detailed 21-page memo in 2005, the U.S. Securities and Exchange Commission had ignored his warnings. Consequently, a scam that totaled about $7 billion when Markopolos first uncovered it in 1999 was allowed to grow to more than nine times that size.
According to Kachroo, the Madoff debacle is not an isolated occurrence, but a symptom of overwhelming flaws that plague our regulatory system.
“This is not a story about one rogue investor,” she said. “It’s a symbol for the systematic failure that we are experiencing in our financial systems. It’s about how we need to change the rules and the roles people play so this never happens again.”
On Feb. 4, Kachroo sat at her client’s side through four hours of congressional testimony in which he presented the House Financial Services subcommittee with his evidence against Madoff, his blistering criticism of the SEC and a series of specific suggestions on how to reform the nation’s financial regulatory system.
“Government has coddled, accepted and ignored white-collar crime for too long,” he told Congress. “It is time the nation woke up and realized that it’s not the armed robbers or drug dealers who cause the most economic harm; it’s the white-collar criminals living in the most expensive homes who have the most impressive resumes who harm us the most. They steal our pensions, bankrupt our companies and destroy thousands of jobs, ruining countless lives.”
Since her client’s testimony, the international financial crisis has occupied more of Kachroo’s professional focus.
She and Markopolos met with the new chairwoman of the SEC, Mary Shapiro, in mid-March to discuss her client’s recommendations for reforming the beleaguered regulatory agency.
The previous month, Kachroo was named vice chairwoman of the newly formed Global Law Firm Alliance, a coalition of 45 firms from 25 nations dedicated to assisting the estimated 3 million victims of the Madoff scam. Because of the complexities involved in adjudicating a worldwide financial fraud, the alliance has proposed the creation of an International Financial Court. Kachroo coordinated meetings with members of Congress and the White House and oversaw the draft proposal and its incorporation into the agendas for the European Union Summit in April and a G-20 meeting in September.
She has also been asked to represent, before Congress and the Securities Investor Protection Corp., a large national coalition of investors in Ponzi schemes, including Madoff’s and several others.
Lawyer for Madoff Whistleblower Launches Own FirmPosted by Brian Baxter
The longtime lawyer for Harry Markopolos, the forensic accountant who tried to warn the SEC about Bernie Madoff, is starting over.
Gaytri Kachroo stepped down from her position as international practice chair at McCarter & English three months ago because of potential conflicts over her work representing victims of Madoff's massive Ponzi scheme.
Last week, Kachroo hung out her own shingle in Kachroo Legal Services. At the moment, the firm is a one-lawyer shop based in Cambridge, Mass.
But the 47-year-old Kachroo has big plans.
Kachroo is focusing most of her attention on a global settlement for all Madoff victims (Kachroo prefers the term "innocent investors" to victims). Her proposal, she says, will provide a cohesive solution for Madoff claimants--Kachroo herself represents about 600--by forging alliances with other firms.
"I'm working on [forming] a consortium of firms in New York, Washington, and Boston," says Kachroo, who declined to publicly name the firms because she doesn't yet have signed agreements from all of them.
Since the Madoff fraud came to light, Kachroo has sought to leverage her connection as counsel to its chief whistleblower. She serves as vice chair of a global alliance of 50 firms representing Madoff investors, and has joined in its call for the creation of an international financial court.
Kachroo also assisted in collecting affidavits that were used for an internal investigation conducted by the SEC's inspector general. The investigation ultimately led to a 457-page report released last month detailing how Madoff systematically deceived the regulator for decades.
It's the SEC that Kachroo has in her sights.
She says the regulator must accept responsibility for its past failures by sponsoring a government-backed global Madoff settlement that will send a positive message to investors worldwide. (Kachroo commends current senior SEC officials for implementing changes to the way the agency operates.)
Taxpayers won't be responsible for funding an SEC-sponsored settlement, Kachroo says. Instead the money will come from a list of financial institutions identified by her and a team of affiliated firms.
"I don't want to go near the word 'bailout,'" she says. "The SEC was not the only agency or institution responsible--it shares responsibility with other financial institutions, many of whom have been bailed out. But they're still deep-pocketed and there's no reason for them not to come forward and settle their claims."
By partnering with the government as a group, Kachroo believes more financial institutions will be incentivized to come forward. The SEC or some other special government task force or commission can administer claims, she says.
It's a tall order for any firm, let alone a start-up, but Kachroo says she's already taken steps towards her goal. The technology behind a registration system for Madoff victims on her firm's Web site is worth nearly $4 million, she says. The money was "provided more or less pro bono" by a sympathetic IT company.
That system will enable Kachroo and those working with her to present the SEC with a comprehensive list of victim names and, as such, emphasize the potential for litigation against the agency, Kachroo says. She hopes to use her growing network of firms to enlist between 100,000 and 1 million investors--"the numbers are key," she adds--for a global settlement.
Kachroo Legal Services might be a one-person firm today, but it's namesake is ready to start hiring immediately.
"It's a big campaign that we're launching here and it's not going to be a one-person job," Kachroo says. "I'm getting outstanding resumes."
She hopes to soon hire one lawyer with six years of SEC experience, something she jokingly notes Markopolos would probably scoff at. A corporate lawyer by trade, Kachroo has a particular need for litigators experienced in fraud and securities cases. (Kachroo, who used to head McCarter's India initiatives, also hopes to add another corporate lawyer to assist with transactional work.)
Start-up capital for her new firm is coming partly from large groups of clients, both domestic and international, who are paying her to investigate and pursue claims against the SEC and certain financial institutions.
Kachroo's efforts to unify various investor groups has also been met with a positive response, she says, adding that the firms she hopes to affiliate with will also share some of the financial burden in order to get her campaign going.
And her star client is also branching out. Markopolos is writing a memoir and plans for a documentary are also in the works. The whistleblower and his team that spent nine years investigating Madoff will work closely with Kachroo's new firm.
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