No Evidence Madoff Even Bought Stock

"It Was All Just Made Up," Say Officials Charged With Cleaning Up Mess

(CBS/AP)  The trustee in charge of untangling the mess brought on by the Bernard Madoff scandal told investors Friday there was no indication the disgraced money manager bought securities for his clients.

"We have no evidence to indicate securities were purchased for customer accounts," said Irving Picard, the court-appointed trustee overseeing the liquidation of Madoff's assets.

He told a meeting for investors that he has recovered $950 million so far and noted that victims could qualify for up to $500,000 in funds from the Securities Investor Protection Corp., also known as the SIPC.

Madoff was arrested in December after investigators said he confessed to his sons that he had swindled investors of $50 billion in a Ponzi scheme. The 70-year-old former Nasdaq chairman remains confined to his Manhattan apartment under house arrest.

Picard detailed the history of the case for the group and how claims will be processed. He said his office has received 2,350 claims so far and expects the number to double. He also said the deadline for submitting claims is July 2.

At the hearing, David Sheehan, a lawyer working for Picard, called the alleged fraud "a Ponzi scheme where no stock was purchased."

Sheehan also said the SIPC will be trying to recover "false profits" earned by some investors.

"There wasn't any stock bought or sold," he said. "It was all just made up. ... You got somebody else's money."

Congress created the SIPC in 1970 to protect investors when a brokerage firm fails and cash and securities are missing from accounts.

Picard said his office and criminal investigators are reviewing a mountain of evidence, including 7,000 boxes of records at a Queens warehouse that go back more than a decade.

Sheehan added that investigators are reviewing "thousands and thousands of e-mails" from Madoff's operation.

Picard also said his office plans to issue dozens of subpoenas in the coming weeks related to Madoff's business dealings.

He cautioned that the criminal investigation is ongoing and said: "We are operating out of a crime scene. There is a limit to what we can say."

Picard called the meeting at a museum in lower Manhattan for investors who lost money because of the alleged fraud. An auditorium that holds 460 was mostly full although it wasn't clear which of those attending had actually invested with Madoff. Investors could also dial into the meeting over the phone, reports CBS News correspondent Steve Kathan.

One investor complained about both Madoff and the federal Securities and Exchange Commission.

Raymond Spungin, 77, of Staten Island told Picard he had checked with the SEC before investing with Madoff in the early 1990s.

"They said Madoff was the greatest," he said. "We're the victims not only of Madoff but of the incompetence of the SEC." He and his wife believe they had $1.8 million in two accounts.

A 90-year-old California investor profiled on the CBS Evening News was forced to go back to work, handing out weekly specials at a supermarket for $10 an hour. Ian Thiermann has gone from contributing to soup kitchens to receiving aid from them after losing $700,000 retirement nest egg he'd entrusted to Madoff.

Experts have said that the first of any recovery payments for investors who lost money with Madoff might be years in the future.

The most likely source is liquidation of Madoff's personal assets and any cash in accounts tied to the investment firm. Picard has identified more than $830 million in liquid assets that may be subject to recovery - far short of the potential tens of billions of dollars in losses.

Madoff has homes in Montauk, N.Y., and Palm Beach, Fla., a penthouse in Manhattan and a handful of luxury yachts. Prosecutors have accused him of mailing off millions of dollars in personal assets to family members while under house arrest.

Outside of liquidating assets, some investors in the scheme could actually be on the hook to make payments in a situation known as "clawbacks." In that case, investors that received alleged profit payments might have to return the money for redistribution.

Sheehan said the assets of Madoff "insiders" could also be seized and liquidated.

"We are looking at every member of the Madoff family," he said.

[sockpuppet4]

I would be pleased to see financier Bernard Madoff get off Scot free. I would like to see him keep his home and money and all charges dropped.

Financier Bernard Madoff has become a FOLK HERO of sorts for me. In all this darkness he has become a small ray of joy for me. I have gained some pleasure from his antics.

Financier Bernard Madoff has done to the RICH what the RICH have done to the working class.

Financier Bernard Madoff should be able to walk and enjoy life no less than Former President George Bush. The George Bush who scammed and twisted all things moral and good for personal gain for himself, his family, and his friends. The George Bush responsible for all the pain and agony going on in the United States and all places on this globe. It would be much more fitting to see the Bush/Cheney team, and all their cohorts facing life in prison than it would be to see what is going on with this one rogue man.

Yes, financier Bernard Madoff has become a modern day FOLK HERO and should be set free. He is no less of a wholesome figure than Robin Hood, comparatively speaking.

VIVA LA FINANCIER BERNARD MADOFF !

May his victims rot in hell.

[rabbitman6]

you would sat at his feet that means you are powerless coward sat at another mans feet.oh you would probaly suck his toes to. you reap what you sow

[rabbitman6]

i guess iam going to start stealing money from people there is no law for stealing in the usa anymore.

[brianbwb-2009]

The biggest and most well knwon hole in US law, as long as you don't directly kill someone, the trick is to steal so much that you can afford the worst case scenario, and still be rich.

It is called the acceptable liability quotient, the automakers have used it for decades, the cost of lawsuits over deaths caused by defective products vs the cost of eliminating the defects.

[allzwell]

You reap what you sow. Madoff harvested politicians and the rich and infamous like the fools they are. Even now he lives in a golden cage. The man is a guru... I sit at his feet.

[rabbitman6]

why aint this guy in jail i heard once on the news a homeless man stoled a piece of pizza from a pizza stand and spent 9 years in prison over it. this is are great good bad worse worser etc... piece of *** goverment at work

[rabbitman6]

just a old joke please have some humor

[rabbitman6]

they are jews what do u expect lol

[rabbitman6]

u know this kind of people like madoff r the scum of this earth [kinda like our government]we the prople of this country need to take it back this kinda people in the old days people of the community would get together kick his door in drag this trash [madoff] out in the street and string up and just beat this trash to dead thats what we need back in this country and as far as our goverment. 99.9% of this guys need the same treatment at federal state and local level

[wagolf1]

Madoff appears to have gotten
special treatment;
because of who he was;
because of who his investors were;
Because of what type of investors supported him.

They enjoyed the rewards of their special treatment
and now want more special treatment.

They want my tax dollars.

No.
Two wrongs do not make a right.
They got what they wanted
They got what they demanded
Now they must live with the results.

Do not give my tax dollars to those who benefitted from their unbridled greed.
To those who got special treatment and now want more, and more, and more.
Stop.

There are no victims, just greedy people who got caught.
Just a bunch of wiiiiinnnersss.

Oh I am special, I invest with Bernie,
I put all my eggs in one basket,
Oops.

There are no victims, just greedy people who got caught.
Just a bunch of ugly wiiiiinnnersss.

Just one of the many sticky fingered thieves on Wall Street.

The SEC seems to be a waste of money, like so much of our government.

[neoconrcrazy]

some report that the Israeli Discount Bank of NYC funneled the funds back to israel .....this "bank" was also accused of money-washing and paid something like 700million on a plea bargin...

maybe the israelis aren't happy with the 5 billion given each year to them? do they need more? i surely wouldn't want to disappoint them....

shalom

[jw218389]

WHY ISN'T HE IN JAIL!!!!!????

[ms1-1-11]

- Clowns to the left..Jokers to the right here we go..
Washington...


... Count Dracula did the Ponzi scam, he did the scam, it was a midnight dream, caught on in a flash, he did the scam, the zombies were having fun,
the party had just begun,the guests included Wolf Man
Dracula and his son they did the scam, the Ponzi scam

The scene was rockin', all were digging the sounds
Igor on chains, backed by his baying hounds
The coffin-bangers were about to arrive
With their vocal group, "The Crypt-Kicker Five"

They played "he did the scam, the Ponzi scam"

[cricketmk3]

"Why is just one person under house arrest? It certainly took more than one man to pull this off. I'm sure that dozens and dozens of people looked the other way when they had reasons to be suspicious."

Exactly...and they ALL should be in jail!

[irmcvet971]

History records what he did.

Shame, shame, on Bush.

Posted by ubrew12 at 10:29 PM : Feb 20, 2009

What is it they say?? You can run but you can't hide?? LOL The Republican Party is finished in this nation for a long long time to come.

[irmcvet971]

I would be a little concerned if I were you. Madoff stole a lot of money from well connected democratic donors. That may not bode well for your party in the next election.

Game, Set, Match.

Posted by IndependentI at 12:48 AM : Feb 21, 2009

So in your POOR tortured Fascist mind, this link will make people forget about the MASSIVE failure of the Republican's and Bush? They will go out and vote those losers and Trickle Down right back in, IGNORING the COMPLETE and ABSOLUTE Failure of the Policy AND the Economic Meltdown that resulted? You really should change that foil on your head Sparky... it's not receiving well at ALL! ROFLMAO

[jw218389]

WHY ISNT HE IN JAIL?????

[docpeter1953]

IndependentI said: "Most of Madoff''''s investors were democrats. "

More importantly: Is Madoff a democrat?
Is the texan Stanford a democrat?
How about Bush? LOL!!!

SERVED...
Posted by ubrew12 at 12:18 AM : Feb 21, 2009
--------------

Let''s see, most investors were from Hollywood, West Palm Beach (Gore voters who could not read the ballot and 2nd home to Teddy), and the Hamptons (home to the elitists from Hollywood & Manhattan). These are hardly republican strongholds.

I would be a little concerned if I were you. Madoff stole a lot of money from well connected democratic donors. That may not bode well for your party in the next election.

Game, Set, Match.

Posted by IndependentI at 12:48 AM : Feb 21, 2009
___________________

You two really need to go and look at the list of investors in Made-Off's scheme and see who lost the $$. 'Game, Set, Match' was on a foul.

[docpeter1953]

The other thing is most of you out there can take a story about nursery rhymes and turn it into a Bush/Obama argument.

Posted by wheear at 10:45 PM : Feb 20, 2009
____________________

Finally someone speaking the truth.

[ubrew12]

IndependentI said: "Most of Madoff's investors were democrats. "

More importantly: Is Madoff a democrat?
Is the texan Stanford a democrat?
How about Bush? LOL!!!

SERVED...