Investors lost money in three recent frauds: Madoff, MF Global, and Peregrine. Are there lessons for a careful investor from these debacles. Three quick lessons come to mind.

Don’t trust the SEC – they are clueless. Barron’s had run an article calling Madoff a Ponzi scheme, an analyst had contacted the Boston and NY offices of the SEC repeatedly, and yet the fraud went on. Do your own homework.

Don’t trust the CFTC or NFA – they may be even more clueless. How hard is it to check segregated funds? Do your own investigating.

Check the auditors. Both Madoff and Peregrine were audited by obscure, one-person, accounting firms. Seems sorta strange for major concerns, right? It may not concern the regulators, but it should concern you.

There are many other lessons as well, but these are three to start with!