How,the,Madoff,Investment,Scan law How the Madoff Investment Scandal was uncovered
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Until recently BernardMadoff was a successful American businessman, former non-executive chairman andone of the NASDAQ stock exchange founders. He is truly one of the livingexamples of the so called American Dream. He started his company with only$5,000 that he earned from working as a lifeguard and sprinkler installer andeventually became one of the biggest players on the stock exchange market. Butthat was only one side of his life. On March 12, 2009, Madoff pled guilty to an 11-count criminalcomplaint and admitted that he defrauded thousands of investors and that he wasresponsible for building up the largest investor fraud ever committed by asingle person. The losses of his clients were almost $65 billion and now Madofffaces a lifelong sentence and up to $170 billion in restitution. The scheme he builtis the so called Ponzi scheme. Named after Charles Ponzi, who was the first manthat created an investment pyramid where the profits of the earlier investorsand Ponzis personal wealth were covered by the new investments. The whole case wasuncovered on December 10, 2008 by one of Madoffs sons. Madoff informed his sons that hedecided to pay several million dollars in bonuses two months earlier thanscheduled and they demanded to know how he is going to pay bonuses if hecouldn't afford to pay investors. After that he admitted that the assetmanagement arm of his firm was a Ponzi scheme. One of the sons reported him tofederal authorities and Bernard Madoff was arrested on December 11. On March 12, 2009 he pledguilty to 11 felonies, including securities fraud, wire fraud, mail fraud,money laundering, perjury and making false filings with the SEC. The maximumsentence for his crimes will be 150 years in prison, plus mandatory restitutionof up to twice the gross gain or loss from his crimes. Still Madoff insiststhat he was solely responsible for the Ponzi scheme and did not reach a pleabargain with the government, because he is most probably covering any of his accomplices.He confessed that he begun his scheme in the early 1990s. Despite the fact thatthe investments gave no profit he continued to satisfy the expectations of highreturns promised to his clients. He actually managed to fool 4,800 clients.None of this money was ever invested, it was simply deposited into his businessaccount at Chase Manhattan Bank. The "profits" were explained by his ownunique "split-strike conversion strategy", but in reality Madoffcreated false trading activities masked by foreign transfers and false SECfilings. Madoff claimed that his firm had "liabilities of approximatelyUS$50 billion", federal prosecutors calculated that the size of the fraudwas $64.8 billion. First concerns about Madoff's business surfaced in the early1999, when financial analyst-whistleblower Harry Markopolos informed the SECthat he suspected the gains Madoff claimed to deliver to be legally andmathematically impossible to achieve, but it actually took Bernard Madoffconfession to uncover this giant scheme. For more information regarding Vancouver Lawyer, Canadian Lawyer, Medicalmalpractice lawyers and Legal services please visit: www.lawyerahead.ca
How,the,Madoff,Investment,Scan