Eisinger on Wilke

A Portfolio editor defends a former WSJ colleague

Madoff whistleblower Harry Markopolos created a stir in journalism circles last week when he testified that he approached one of The Wall Street Journal’s top investigative reporters, John Wilke, with the Madoff story in 2005 but nothing was done. While Markopolos speculated that Journal editors never “gave him approval,” some online commentary nonetheless faulted Wilke.

Jesse Eisinger, a onetime WSJ colleague of Wilke and now Wall Street editor for Conde Nast Portfolio takes exception to that view:

I’m pretty jaded, so typically when I see journalists eating their own, I barely pause from my daily routine. But I’ve been flabbergasted by comment about The Wall Street Journal’s John Wilke, our former colleague, regarding his role in the Bernard Madoff scandal. It’s way out of line and verges on the delusional.

None of the bloggers and assorted critics seem to have researched what Wilke
was doing during the period he supposedly missed the Madoff story. Wilke is
one of the finest investigative journalists in the country and he continued
to prove it in the time he was in contact with Harry Markopolos, the Madoff

Converting a speculative tip from someone like Markopolos is vastly harder
than it looks in retrospect. Markopolos was an outsider who figured out
something was wrong with Madoff — but wasn’t sure exactly what that was.
Nobody “tees up” stories about financial frauds ­ as one of Wilke¹s
detractors wrote on Romenesko, misspelling both his and Markopolos¹s name.

As all journalists, Wilke was likely conducting constant triage at the time, deluged by tips, story ideas, editor pressure and breaking news. Nevertheless, here¹s a partial list of what he wrote in that period:

-On Dec. 27, 2005, Wilke broke that legendary mutual-fund trader Mario
Gabelli, then a bigger name on Wall Street than Madoff, had set up what
appeared to be sham minority and small-business firms to bid for discounted
FCC spectrum licenses. Six months after the story appeared, Gabelli settled
civil fraud claims with the government for $100 million.

-On Feb. 10, 2006, Wilke did a page-one story about alleged price-fixing by
China’s vitamin makers.

-On April 7, Wilke revealed a network of West Virginia non-profits set up by
former staffers and supporters of Rep. Alan Mollohan, funded by
congressional earmarks. (The New York Times followed the next day.)

-On Oct. 11, the Journal reported that most of the earmarks won by Rep.
Charles Taylor, a North Carolina Republican, also benefited his family
banking and timber interests.

-On Nov 1, Wilke exposed that a wealthy Nevada defense contractor had
funneled nearly $100,000 in campaign cash to Gov. Jim Gibbons through a
network of his companies, side-stepping state campaign-finance laws and
treating his patron to a lavish, undisclosed Caribbean cruise.

I could go on about Wilke scoops. But the point is clear: For a year after
December 2005, Wilke bagged a series of journalistic trophies that would
make any self-respecting investigative reporter proud. Yes, with the benefit
of hindsight, it is easy to see that he should have demanded that his editor
give him the rest of the year to do Madoff, and nothing else. But let’s get

-Jesse Eisinger

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Dean Starkman Dean Starkman runs The Audit, CJR's business section, and is the author of The Watchdog That Didn't Bark: The Financial Crisis and the Disappearance of Investigative Journalism (Columbia University Press, January 2014). Follow Dean on Twitter: @deanstarkman.