Confession is always good for the soul, and according to the federal complaint issued today against one of Wall Street’s most venerable investment names, that’s exactly what sparked the investigation into Bernard L. Madoff, 70.
As the complaint states: “On December 10, 2008, MADOFF informed the Senior Employees, in substance, that his investment advisory business was a fraud. MADOFF stated 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 stated that the business was insolvent, and that it had been for years. MADOFF also stated that he estimated the losses from this fraud to be at least approximately $50 billion. MADOFF further informed the Senior Employees that, in approximately one week, he planned to surrender to authorities, but before he did that, he had approximately $200-300 million left, and he planned to use that money to make payments to certain selected employees, family, and friends.”
Madoff was arrested this morning and charged with one count of securities fraud for which he faces 20 years in prison.