The U.S. Department of Justice and the Securities and Exchange Commission today charged former Nasdaq Chairman Bernard L. Madoff and his investment firm, Bernard L. Madoff Investment Securities LLC, with securities fraud for a multi-billion dollar Ponzi scheme that he perpetrated on advisory clients of his firm.
According to regulatory filings, the firm had more than $17 billion in assets under management and it appears that virtually all assets of the advisory business are missing. The SEC is seeking emergency relief for investors, including an asset freeze and the appointment of a receiver for the firm.
Both complaints allege that Madoff informed two senior employees that his investment advisory business was a fraud. Madoff told them 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." According to the SEC, Madoff admitted in this conversation that the firm was insolvent and had been for years, and that he estimated the losses from this fraud were at least $50 billion.
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.
HYPERLINK "Former%20Nasdaq%20chairman%20charged%20$50%20billion%20fraud"Read the SEC’s complaint
HYPERLINK "http://online.wsj.com/documents/madoffcomplaint.pdf" Read the DoJ complaint