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If you're gonna commit fraud, don't do it small. $50 billion
Yakumo Fujii
Registered User regular
Registered User regular
Christ, this could cause a run on hedge funds in general tomorrow.
http://www.google.com/hostednews/ap/article/ALeqM5gA_cNr1uDE47pySwMmPvCpqCHH3gD950UBRO3
http://www.google.com/hostednews/ap/article/ALeqM5gA_cNr1uDE47pySwMmPvCpqCHH3gD950UBRO3
Ex-Nasdaq chair arrested on fraud charge in NYC
By LARRY NEUMEISTER – 1 hour ago
NEW YORK (AP) — A former Nasdaq stock market chairman was arrested on a securities fraud charge Thursday, accused of running a fraudulent investment business that lost at least $50 billion before he confessed to senior employees it was a "giant Ponzi scheme," authorities said.
Bernard L. Madoff, his silver hair reflecting the lights of a federal courtroom, was released on $10 million bail secured by his signature and that of his wife. He declined to comment as he walked out of U.S. District Court in Manhattan.
Madoff, 70, the founder of Bernard L. Madoff Investment Securities LLC, maintained a separate and secretive investment-advising business that served between 11 and 25 clients and had a total of about $17.1 billion in assets under management, prosecutors said.
Late Thursday, the Securities and Exchange Commission announced a civil securities fraud charge against Madoff and said it was seeking emergency relief for investors, including an asset freeze and the appointment of a receiver for the firm.
Andrew M. Calamari, associate director of enforcement in the SEC's New York office, said the SEC was alleging "a stunning fraud that appears to be of epic proportions."
A criminal complaint signed by FBI Agent Theodore Cacioppi said Madoff told at least three senior employees at his Manhattan apartment Wednesday that the investment adviser business was a fraud and had been insolvent for years, losing at least $50 billion.
Madoff told the employees he was "finished," that he had "absolutely nothing," that "it's all just one big lie" and it was "basically, a giant Ponzi scheme," according to the complaint filed in court.
The employees understood Madoff's admission to mean that "he had for years been paying returns to certain investors out of the principal received from other, different, investors," said the complaint, which did not identify the investors impacted by the scheme.
Cacioppi said one of the employees told him that Madoff was "cryptic" about the firm's investment advisory business and kept its financial statements locked up. The FBI agent said another employee told him that Madoff last week had said clients had asked for about $7 billion in redemptions and he was struggling to meet those obligations but thought he could do so.
Cacioppi said two senior Madoff employees told him that Madoff said during the Wednesday meeting that he planned to surrender to authorities in a week but first wanted to distribute $200 million to $300 million he had left to certain selected employees, family and friends.
Cacioppi said he and another FBI agent arrived Thursday at Madoff's apartment, where Madoff invited them in and acknowledged knowing why they were there.
"After I stated, `We're here to find out if there's an innocent explanation,' Madoff stated, `There is no innocent explanation,'" the agent wrote.
"Madoff stated, in substance, that he had personally traded and lost money for institutional clients, and that it was all his fault," Cacioppi said.
The agent wrote that Madoff said he had "paid investors with money that wasn't there" and that he was broke and insolvent and had decided that "it could not go on" and that he expected to go to jail.
Defense lawyer Dan Horwitz called Madoff "a person of integrity" and said he intends to fight the charge.
If convicted, Madoff could face up to 20 years in prison and a maximum fine of $5 million.
Bernard L. Madoff Investment Securities LLC ranks among the top 1 percent of U.S. securities firms, according to the company's Web site.
In 2001, Barron's reported that Madoff's firm was one of the three top market makers in Nasdaq stocks and the third-largest firm matching buyers and sellers of securities on the New York Stock Exchange.
Shortly after leaving law school, Madoff founded his firm in 1960. It was one of five broker-dealers most closely involved in developing the Nasdaq Stock Market, where he served as a member of the board of governors in the 1980s and as chairman of the board of directors.
Prosecutors noted in a release that the company Web site boasts: "Clients know that Bernard Madoff has a personal interest in maintaining an unblemished record of value, fair-dealing and high ethical standards that has always been the firm's hallmark."
What was she like?
"Ordinary. The kind of dangerous, beautiful ordinary that you just can't leave alone. Like an angel from the underworld or maybe a devil from paradise."
"It is far better for the truth to tear my flesh to pieces, then for my soul to wander through darkness in eternal damnation."
"Ordinary. The kind of dangerous, beautiful ordinary that you just can't leave alone. Like an angel from the underworld or maybe a devil from paradise."
"It is far better for the truth to tear my flesh to pieces, then for my soul to wander through darkness in eternal damnation."
Yakumo Fujii on
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The performance of the market has an important psychological component to it. This will undermine the confidence of people in the market. Some investors will be scared the funds they invest in will be crooked as well and take their money out.
"Ordinary. The kind of dangerous, beautiful ordinary that you just can't leave alone. Like an angel from the underworld or maybe a devil from paradise."
"It is far better for the truth to tear my flesh to pieces, then for my soul to wander through darkness in eternal damnation."
If two news stories two weeks apart qualify, I guess so.
"Ordinary. The kind of dangerous, beautiful ordinary that you just can't leave alone. Like an angel from the underworld or maybe a devil from paradise."
"It is far better for the truth to tear my flesh to pieces, then for my soul to wander through darkness in eternal damnation."
$50 billion is a lot of money
like
a lot of money
flawless victory
What what.
About 167
Or maybe 194 if they cost 85¢
You have to remember that you get 2 for $1.
I mean, really, what do you think is more harmful, $50 billion worth of fraud, or 500 grams of cocaine?
The better question is, who gives a fuck?
Laws and penalties around drugs are, and have always been, pretty stupid in many regards.
I think you're not reading enough into the situation
This firm ranks among the top 1% of securities firms
When a firm of that size runs into problems it shakes investor confidence across the board
See I'm not jumping to conclusions. I know that the actions of one person don't affect the validity of hedge funds.
However part of the "game" is to figure out what everyone else is going to do. How it works is people think to themselves "What if this makes people sell their hedge funds? I better sell my funds first just in case!" And then it spirals from there. If enough people do that right as the market opens to cause even a slight dip in hedge fund values, it can cause a landslide.
Frankly, I don't see why the death penalty shouldn't be on the table for this guy. I mean, if we're going to have it, this is the kind of thing we should be using it for.
But he's rich!
You can't kill rich people!
Retributive justice, no? The death penalty is more for cases in which the criminal should be paid 'in kind', eye for an eye in short. (Granted, the distinctions of when that's applicable are a lot more hazy.)
Fifty billion sucks, but it's not like he murdered an orphanage. :P
I have to agree. Another thing is that white collar crime is something that doesn't get a lot of press unless the impact has big numbers.
Kenneth Lee Lay was facing what, 20-30 years? Luckily he dropped dead of a massive heart attack. I'd like to think it was some sort of divine intervention as to say "Nope, you don't get to play here anymore".
money is there to earn when you sell shit or do your job.
it is also there to spend when you buy shit or pay employees.
where the fuck did this whole speculation bullshit come from anyway?
"Here, I am giving you money that doesn't exist, Tada".
I'm kind of curious as well how a man who is being charged for fraud and losing 50 billion dollars, can make bail by signing a sheet of paper to say 'yeah I'm totally good for it' to the tune of 10 million.
Better yet, why the fuck is a man who defrauded people out of money allowed to make bail? He made his money off of conning people. HE SHOULDN'T NOW BE ALLOWED TO TURN AROUND AND USE IT
What a fucking cunt.
HE'S RUINED!!
First thing tomorrow I'm heading across the river and torching the Harvard School of Business. And the Law School just in case. Because seriously, what the fuck are they teaching these people?
If I cheat people out of fifty billion dollars, I have probably lost thousands of people their jobs, tens of thousands of people their retirement (if not hundreds of thousands of people), and basically taken a bit of money from every single taxpayer in the U.S., hurting tens of millions.
There really is no comparison.
He should be forced to do community service. Collecting trash on the freeway for $5 an hour. Until it's all paid back.
Personally, I'd have his entire estate seized, liquidated and pumped back into the economy. Then I'd lobotomize him and force the people who benefited from his greed with legal guardianship of tard.
See, it's this kind of creative punishment which is needed to stop people being so mean. Jail? BORING! This also has the benefit of punishing the greedy fucks who let him get away with this for so long
But, fuck it, keeping the benjamins flowin', yo.