Bernard Madoff arrested by FBI

Bernard Madoff was arrested by the FBI on Thursday and charged with criminal securities fraud, the Wall Street Journal reported. Criminal complaint against Madoff alleges he told senior employees that firm was giant ponzi scheme.

Madoff faces as much as 20 years in prison and a $5 million fine if convicted. His New York-based firm was the 23rd largest market maker on Nasdaq in October, handling a daily average of about 50 million shares a day, exchange data show. It specialized in handling orders from online brokers in some of the largest U.S. companies, including General Electric Co. and Citigroup Inc.


A partial list of victims:

• Access International Advisers, New York-based investment firm may have lost $1.4 billion in assets, according to Bloomberg.
• Banco Santander (largest euro-zone bank, by market cap) – Spanish bank reported yesterday that clients of one of its Swiss subsidiaries have lost $3 billion.
• Banque Bénédict Hentsch – $47.5 million worth of client assets at risk.
• Basically everyone at the Palm Beach Country Club – Madoff has belonged since 1996. "I’m taking care of my sick mother-in-law," one member, Richard Spring, 73, told the Times. "My wife has cancer. I just can’t deal with it. I’m cooked."
• Benbassat & Cie Swiss bank has 1.1 billion francs, or $935 million, at stake, according to la France via Reuters.
• BNP Paribas (largest French bank) – Did not invest directly in the Madoff funds but has 350 million euros, or about $500 million, at risk through trades and loans to hedge funds.
• Bramdean Alternatives – British asset manager lost $19 million, or 9 percent of the company, according to a statement. The female CEO is being pilloried in the press: "I am an ordinary person who manages pension funds for pensioners. If I was a male fund manager this would not happen. Someone has to take a stand. If women are persecuted in this way you won't have any female fund managers. This could destroy me," she told the Evening Standard.
• Carl & Ruth Shapiro Family Foundation – 99-year-old Boston philanthropist Carl Shapiro's foundation lost $145 million, almost half its money, according to the Boston Globe
• Chais Family Foundation – Gives out some $12.5 million each year to Jewish causes in Israel, the former Soviet Union, and Eastern Europe; announced yesterday that it had closed after losing all of its money through investments with Madoff.
• Elie Wiesel Foundation for Humanity – Invested money with Madoff — its losses are thus far unknown.
• EIM Group – European investment manager has $230 million exposed.
• Fairfield, Conn. – $42 million, or 15 percent of the town's retiree pension fund.
• Fix Asset Management $400 million.
• Madoff employees – "Generations of employees had worked for Madoff and invested their savings there."
• Fred Wilpon – New York Mets owner, unknown.
• Harel Insurance – Israeli investment service, $14.2 million.
• HSBC – $1 billion at risk.
• Avram and Carol. Goldberg – The Boston-based founder of the Stop & Shop supermarket chain and his wife lost $29 million, according to reports.
• J. Ezra Merkin – The GMAC LLC chairman's Ascot Partners lost most of its $1.8 billion, according to the Journal.
• Jewish Community Foundation of Los Angeles – $18 million of the Foundation's Common Investment Pool (currently valued at 11 percent of its assets) was invested with Madoff.
• The JEHTFoundation As commenter Sleater noted below, the JEHT Foundation, a nonprofit in downtown New York that promoted reform of the criminal and juvenile justice systems, has been felled by Madoff and will close, according to its web site, at the end of January 2009. According to the Web site: "The funds of the donors to the Foundation, Jeanne Levy-Church and Kenneth Levy-Church, were managed by Bernard L. Madoff, a prominent financial advisor who was arrested last week for defrauding investors out of billions of dollars."
• Julian J. Levitt Foundation – Texas-based Jewish charity, lost about $6 million.
• Kingate Management Ltd. – $3.5 billion at risk, according to Bloomberg.
• Korea Life Insurance Co – $50 million.
• Korea Teachers pension – Has $9.1 million indirectly invested.
• The Madoff Family Foundation – Madoff's own charity gave to the Memorial Sloan Kettering Hospital, Leukemia and Lymphoma Society, Lincoln Center, Robin Hood Foundation, and others. Its $19 million is gone, obviously.
• Man Group PLC – The world's largest publicly traded hedge-fund manager, $360 million.
• Maxam Capital Management – Darien-based hedge fund helmed by Sandra "Jerry Maguire of hedge funds" Manzke lost $280 million. "I'm wiped out," Manzke told the Journal.
• M&B Capital Advisors – Spanish hedge funds had $578 million invested.
• Mort Zuckerman, Daily News owner – "Significant exposure through a fund that invested substantially all of its assets with Mr. Madoff," according to the Journal.
• New Jersey Senator Frank Lautenberg – "One of the wealthiest members of the Senate, entrusted his family's charitable foundation to Madoff. Lautenberg's attorney, Michael Griffinger, said they weren't yet sure the extent of the foundation's losses, but that the bulk of its investments had been handled by Madoff."
• Nomura Holdings Inc. – Tokyo investment firm; said today it had $302 million in exposure.
• Norman Braman – Former Philadelphia Eagles owner, unknown.
• The North Shore-Long Island Jewish Health System – $5 million.
• Neue Privat Bank – Acknowledged being at risk.
• Pioneer Alternative Investments – Irish hedge fund invested all of its $280 million in assets with Madoff — gone.
• Robert I. Lappin Charitable Foundation – The Boston-based charity, which financed trips for Jewish youth to Israel, announced last week: "The money needed to fund the programs of the Lappin Foundation is gone. The foundation staff has been terminated today."
• Royal Bank of Scotland – $600 million exposed.
• Societe Generale – The French bank lost less than $13.46 million dollars, which it called a "negligible" amount.
• Walter M. Noel Jr. and the Fairfield Greenwich Group – The Fairfield Greenwich Group invested billions of dollars with Madoff over twenty years, and has lost approximately $7.5 billion. “[Noel] was a person of superb ethics, and this has to cut him to the quick,” George L. Ball, a colleague of the founder, told the Times.
• The Wunderkinder Foundation – Steven Spielberg's charity. "In 2006, the Madoff firm accounted for roughly 70% of the foundation's interest and dividend income, according to regulatory filings."
• Reichmuth's Reichmuth Matterhorn fund – 385 million Swiss francs, or $327 million, in potential losses.
• Yeshiva University – "Sources close to Yeshiva University, where Madoff served as treasurer of the board of trustees and chairman of the board of Y.U.’s Sy Syms School of Business until he resigned last week, said that the school has lost tens of millions of dollars, if not more," according to Jewish and Israel News.
• The JEHT Foundation, whose funds were entirely managed by Madoff is closing its doors immediately, terminating payments on existing grants: http://www.jehtfoundation.org/news/

Many other clients are in a panic that their wealth may be gone.

more at http://www.nytimes.com/2008/12/12/business/12scheme.html


Madoff Securities Company Description
Founded in 1960, Bernard L. Madoff Investment Securities is a top market maker in US stocks, including all of the S&P 500 and more than 350 Nasdaq stocks, as well as bonds and other instruments. It is also a member of the London Stock Exchange. The firm moves large blocks of stock for institutional clients by splitting up orders or arranging off-exchange transactions between parties. Clients include brokerages, banks, and other financial institutions. The firm, which is controlled by founder Bernard Madoff and his family, also performs clearing and settlement services.
website http://madoff.com/