Friday, December 12, 2008

Bernard Madoff arrested over alleged $50 billion fraud

From Reuters:

Bernard Madoff arrested over alleged $50 billion fraud
By Edith Honan and Dan Wilchins Edith Honan And Dan Wilchins – Fri Dec 12, 12:40 am ET

NEW YORK (Reuters) – Bernard Madoff, a quiet force on Wall Street for decades, was arrested and charged on Thursday with allegedly running a $50 billion "Ponzi scheme" in what may rank among the biggest fraud cases ever.

The former chairman of the Nasdaq Stock Market is best known as the founder of Bernard L. Madoff Investment Securities LLC, the closely-held market-making firm he launched in 1960. But he also ran a hedge fund that U.S. prosecutors said racked up $50 billion of fraudulent losses.

Madoff told senior employees of his firm on Wednesday that "it's all just one big lie" and that it was "basically, a giant Ponzi scheme," with estimated investor losses of about $50 billion, according to the U.S. Attorney's criminal complaint against him.

A Ponzi scheme is a swindle offering unusually high returns, with early investors paid off with money from later investors.

On Thursday, two agents for the U.S. Federal Bureau of Investigation entered Madoff's New York apartment.

"There is no innocent explanation," Madoff said, according to the criminal complaint. He told the agents that it was all his fault, and that he "paid investors with money that wasn't there," according to the complaint.

The $50 billion allegedly lost would make the hedge fund one of the biggest frauds in history.

Rest of story at link above.

He's a straight up THIEF.


How does one steal FIFTY BILLION DOLLARS?


Anonymous said...

I hope he gets his fair share rectally when he is imprisoned.

Brian said...

Unreal. It is further proof that the lack of regulation has been a Cancer for Wall Street... leading to the greed and corruption that we have been seeing recently.

One man or group shouldn't be able to steal and misuse such a huge amount of money. But he apparently did... and so did the big firms with those Mortgage backed securities (just creating their own investment instruments).

With an SEC, FBI, one caught this sooner?

Meanwhile, the IRS is busy auditing the Hell out of the little guy....

This kind of craziness makes my stomach turn.