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Friday, December 12, 2008

SEC charges former NASDAQ chairman with securities fraud
Jaclyn Belczyk at 8:21 AM ET

[JURIST] Former NASDAQ [official website] stock market chairman Bernard Madoff was arrested [DOJ press release, PDF] Thursday by federal agents on charges of securities fraud. The US Securities and Exchange Commission (SEC) [official website] charged [SEC press release] Madoff and his investment firm, Bernard L. Madoff Investment Securities LLC [corporate website], on Thursday with engaging in a multi-billion dollar Ponzi scheme. He has been charged with violating the anti-fraud provisions of the Securities Act of 1933, the Securities Exchange Act of 1934, and the Investment Advisers Act of 1940 [texts]. Madoff allegedly told two employees of his firm Wednesday that his investment advisory business was a fraud. According to the complaint, 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 was released on bail later Thursday. A preliminary hearing is scheduled for January 12.

Madoff, 70, founded his investment firm in 1960. He has served as chairman of the board of directors of the NASDAQ stock market and was a member of the board of governors of the National Association of Securities Dealers (NASD). According to his firm's website, it ranks among the top 1 percent of US securities firms.

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