by Sotally Tober
Thu Dec 11, 2008 at 06:51:12 PM PST
Reuters has reported that Bernard Madoff, former chairman of the Nasdaq Stock Market was arrested and charged with allegedly running a $50 billion Ponzi scheme.
Madoff remains a member of Nasdaq OMX Group Inc's nominating committee, best known as the founder of Bernard L. Madoff Investment Securities LLC, the closely-held market-making firm he founded in 1960.
But the alleged fraud involved a hedge fund he ran from a separate floor of the building where his brokerage is based.
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The $50 billion allegedly lost to investors would make Madoff's fund one of the biggest frauds in history. When Enron filed for bankruptcy in 2001, one of the largest at the time, it had $63.4 billion in assets.
Prosecutors charged Madoff, 70, with a single count of securities fraud. They said he faces up to 20 years in prison and a fine of up to $5 million.
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A shaken Madoff stared at the ground as reporters peppered him with questions. He was released after posting a $10 million bond secured by his Manhattan apartment.
The
SEC filed separate civil charges.
"Our complaint alleges a stunning fraud -- both in terms of scope and duration,"
said Scott Friestad, the SEC's deputy enforcer.
"We are moving quickly and decisively to stop the scheme and protect the remaining assets for investors."
Madoff had long kept the financial statements for his hedge fund business under "lock and key," according to prosecutors, and was "cryptic" about the firm.
Bernard L. Madoff Investment Securities has more than $700 million in capital, according to its
website.more
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