For all those who believe this was a one man band.
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Madoff said he acted alone. The investigation proved otherwise. Among his accomplices — admitted and alleged:
Frank DiPascali Jr.
When he pleaded guilty last August to 10 charges, including conspiracy, Frank DiPascali Jr., Madoff’s right-hand man/chief financial officer, said he’d “ended up being loyal to a terrible, terrible fault.” He began working for Madoff after graduating high school, and had participated in the scheme for some 20 years. DiPascali, 53, hasn't been sentenced yet, but could face a maximum sentence of 125 years in prison. Federal prosecutors have said they're likely to recommend leniency, however, because of the extent of his cooperation. He was in jail until last month, when a judge granted bail.
David Friehling (above)
Madoff's longtime outside accountant and the firm's supposed auditor, David Friehling, pleaded guilty to several charges, including securities fraud, last November. But he also said, “At no time was I aware that Mr. Madoff was engaged in a Ponzi scheme.” He is awaiting sentencing, and could face as much as 114 years.
Daniel Bonventre
Madoff’s director of operations was charged just two weeks ago. According to the SEC complaint, Bonventre, who worked for Madoff for at least three decades, “enabled and helped perpetuate the now infamous fraud” by falsifying accounting records for years.
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Madoff's money had to come from somewhere. Enter feeder funds. Among the money managers turned defendants:
J. Ezra Merkin (left)
Last April, New York State Attorney General Andrew Cuomo filed a civil lawsuit against J. Ezra Merkin, alleging that the money manager (who had a reputation as a philanthropist) had swindled his fee-paying clients, deceitfully channeling their money to Madoff. Investors—which included nonprofits—lost more than a billion dollars as a result. Merkin's request that the lawsuit be dismissed was denied by a New York judge in February.
Walter Noel/Fairfield Greenwich Group
Walter Noel's Fairfield Greenwich Group (FGG) was the largest feeder fund investing with Madoff, sending billions of clients' dollars his way. It's been hit with several lawsuits. In April, Massachusetts securities regulators brought civil fraud charges against FGG. They settled in September, neither admitting nor denying the charges but agreeing to pay some $8 million to various Massachusetts investors.
Sonja Kohn/Bank Medici
Madoff-related losses were not restricted to the U.S. The month after Madoff's arrest, the Austrian government assumed control of Bank Medici. It was sued, along with the bank's chair Sonja Kohn, by Repex Ventures SA, a company in the British Virgin Islands, which alleged investors were not made aware of the channeling of funds to Madoff. The company has given up its banking license and changed its name to 20.20 Medici AG. Kohn, who is under investigation, has said she is nothing more than a victim in the Madoff scandal.
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Maybe the SEC have a case to answer
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In 2005, Harry Markopolos sent a memo to the Securities and Exchange Commission titled, "The World's Largest Hedge Fund Is a Fraud."
The SEC didn't listen.
It seems Markopolos was onto Bernie Madoff's case much earlier than most. He says he discovered that Madoff was a fraudster in 2000, after just five minutes of looking into his records. In late 1999, Markopolos' boss at the investment firm he worked for asked him to analyze the Madoff fund to see how they might replicate its stunning returns. But, of course, Markopolos soon discovered that his firm could not replicate the fund's performance, no one could — at least not legally. He first notified the SEC in May 2000. "I didn't even get a thank you," Markopolos told The Daily Show's Jon Stewart on March 8, 2010. But the SEC's dismissal of his claims did not stop him from his pursuit. Markopolos eventually quit his job, hired a team to track Madoff across two continents and continued to send notifications to the SEC for a total of eight-and-a-half years. Notices that he said kept getting more serious and more dire as the years progressed. "I'm so angry, I can't tell you how angry I am," he told Stewart.
Markopolos further expresses his anger in a book called No One Would Listen: A True Financial Thriller released earlier this month. He is currently on a book tour.