Wall Street Shocked At Madoff's Ponzi Scheme of "Epic Proportions"
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Yesterday afternoon, Wall Street was shocked to learn that well-respected trader Bernard Madoff was arrested for running a "giant Ponzi scheme" that he perpetrated on advisory clients of his firm. The SEC called it a "stunning fraud that appears to be of epic proportions."
In its complaint, the SEC alleges that yesterday Madoff told two high level employees that his business was a fraud. He told these employees that he was "finished," that he had "absolutely nothing," that "it's all just one big lie," and that it was "basically, a giant Ponzi scheme." Madoff had for years been paying returns to certain investors out of the principal received from other, different investors. Madoff estimated the losses from this fraud were at least $50 billion.
According to regulatory filings, the Madoff firm had more than $17 billion in assets under management as of the beginning of 2008. It appears that virtually all assets of the advisory business are missing.
Madoff founded the firm in 1960 and has been a prominent member of the securities industry throughout his career. Madoff served as vice chairman of the NASD, a member of its board of governors, and chairman of its New York region. He was also a member of NASDAQ Stock Market's board of governors and its executive committee and served as chairman of its trading committee.
Large losers from the scam may include $7.3 billion fund Fairfield Sentry and $2.8 billion Kingate Global Fund, who both invested with Madoff.
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Where is the money?
What was he doing with the money if he was not investing it?
More info on arrest
more info on arrest http://tradingstockindices.com/breakingnews/stock-market-bernard-madoff-arrested-over-alleged-50-billion-fraud/
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$25 Million Fine & 5 Years in Prison?
Jim Martin on Dec 19, 2008 05:41 PMSo, he steals $50 Billion. He faces, if convicted, a $25 Million fine, and 5 years in jail. Leaving him with the rest of his miserable life to spend the other 49 Billion, 750 Million dollars? If I were a crook, I would be looking for the sign up sheet for this deal!!! Our respective legislators need to be harassed a bit, to push some laws through to have the punishment fit the crime. Current legislation gives him a punishment that would be comparable to convicting hitler simply as an accessory to murder.