AND YOU WONDER WHY NO ONE BUT BERNIE IS IN JAIL?

In the 2/12/11 issue of NYT, Frank Rich reminds us of the “Scott free” condition perpetrated by the Obama Administration for the Wall Street architects of the Great Recession. As Rich relates it, the Madoff trail is being blazed by Irving H. Picard, the bankruptcy trustee pursuing loss claims for Madoff’s victims by pursuing hundreds of lawsuits to retrieve fictitious “profits” from the lucky coterie of Madoff investors who cashed out before his arrest. Now Picard has raised the stakes with suits that include JPMorgan, the Madoff banker.

JPMorgan is the sole big bank that survived the economic crisis with its balance sheet, image and chief executive, Jamie Dimon, more or less unscathed. Dimon, as a Times Magazine cover put it in December, is “America’s Least-Hated Banker,” an unpretentious guy (and lifelong Democrat) whose self-professed mantra is “do the right thing.”

Picard’s litigation asserts that JPMorgan saw red flags about Madoff’s legitimacy yet never bothered to notify either the authorities or its own Madoff-invested customers as long as there was money the bank could scoop off the craps table. In one internal JPMorgan e-mail cited in the lawsuit — dated June 2007, some 18 months before Madoff’s arrest — a Chase investment officer told colleagues that he had heard of “a well-known cloud” over Madoff, including speculation that he was “part of a Ponzi scheme.” And yet, according to Picard’s brief, Madoff could freely cycle billions of dollars of his clients’ money through Chase accounts until the end — even as the bank itself was busily dumping $241 million of its $276 million in Madoff investments.

Dimon appeared on a panel at the World Economic Forum in Davos, Switzerland, titled “The Next Shock, Are We Better Prepared?” and complained not for the first time — or the 10th — about what he considers unfair treatment by the press and the Obama administration. He’s just sick, he said, of the “constant refrain” of “bankers, bankers, bankers.” His arrogance compelled even the French president, Nicolas Sarkozy, no socialist, to speak up and chastise American banks for repeatedly defying “simple common sense” over the last decade.

Indeed. If the Picard charges about the Madoff-JPMorgan nexus weren’t enough, last week a Dimon underling had to publicly apologize before Congress to military families for the bank’s financial abuse of Americans fighting in Iraq and Afghanistan over the same period. JPMorgan overcharged at least 4,500 soldiers on their mortgages and illegally foreclosed on 18 of them. Many of these victims have been battling JPMorgan for years to get it to obey the law. Let us not forget that this is the one big bank that was considered Wall Street’s model citizen.

As for the question posed to Dimon’s Davos panel, the answer is No, for the most part, we’re not better prepared for the next shock. It’s not even clear we want to be prepared. The Financial Crisis Inquiry Commission was ridiculously under-supported by Congress — it had less than one-sixth the budget of the musical “Spider-Man” to shed light on years of opaque financial maneuvers by huge, lawyered-up institutions. Even its worthy final report’s release was drowned out, as bad luck would have it, by the uprising in Egypt. Now the new conservative attack dog of the House, Darrell Issa, is gearing up an inquiry of the financial crisis inquiry. His only conceivable purpose is to ward off any future attempts to pursue the still unanswered questions about the meltdown.

The commission’s report, full of fascinating detail, received mixed reviews. One critic, Yves Smith, of the financial blog Naked Capitalism, chastised it for not digging into how the financial industry profited obscenely (and in her view, fraudulently) by deliberately creating “toxic instruments” like subprime-mortgage-backed securities just to bet against them. Michael Lewis, author of “The Big Short,” was far more favorable about the report but scarcely less fatalistic. “I feel like we’re living in a house built on sand because we didn’t reform the system,” Noting that banks have returned to huge profits while helping themselves to zero interest loans, Lewis concluded that “we still have “socialism for capitalists, and capitalism for everybody else.”

But it’s not just financial reform that has fallen short. We still don’t have cops to catch those who break the law. Which brings us back full circle to Madoff. Not the least of his cautionary tale’s subplots was the one starring Harry Markopolos, a private financial investigator and whistle-blower who repeatedly contacted the Securities and Exchange Commission for nearly a decade with evidence of Madoff’s fraud — only to be ignored.

Markopolos was lionized on “60 Minutes” and published a book, “No One Would Listen,” dramatizing his lonely crusade. And where is the S.E.C. today? Caught in the federal budget freeze — and bracing for further cuts by the antigovernment, antiregulatory Republican House — the agency can’t hire the employees needed to enforce existing security laws, let alone new ones created by the Dodd-Frank financial overhaul. It must use archaic technology to chase high-tech trading systems that operate “at the speed of light,” as Mary Schapiro, the S.E.C. chairwoman, put it. The agency’s new whistle-blower office — created precisely to welcome informants like Markopolos — has been put on hold.

Determined as Picard, our accidental Pecora, may be, the fact remains that the time couldn’t be riper for the next Madoff, whether in a strip mall or in the elite gambling dens of Wall Street, to get in the game.

May I add especially while the Obama Administration is still looking the other way.