By: Chad Bray, Dow Jones Newswires
This appeared on smartmoney.com, see full story
Disgraced financier Bernard L. Madoff on Thursday publicly admitted to running a massive, decades-long Ponzi scheme that bilked investors out of billions of dollars, saying he was ashamed and acknowledging that he deeply hurt many people.
At a packed hearing in U.S. District Court in Manhattan on Thursday, Madoff pleaded guilty to 11 criminal charges, including securities fraud, wire fraud, mail fraud, money laundering and making a false filing with the U.S. Securities & Exchange Commission.
Dressed in a charcoal-gray suit, Madoff said he ran a Ponzi scheme for many years in his firm’s investment advisory business and that he never invested client funds as promised.
Madoff, 70 years old, said he felt compelled to meet clients’ expectations for returns that outpaced the market and thought the scheme would end shortly. Madoff said he started the scheme during a recession, which was difficult for investing in stocks.
“I never invested funds in securities as promised,” Madoff said.
Madoff will likely spend the rest of his life in prison. The charges carry of a maximum of 150 years in prison. Sentencing is set for June 16.
Following the plea, U.S. District Judge Denny Chin, who is presiding, ordered that Madoff’s bail be revoked and he be jailed pending sentencing.
Applause briefly broke out, before the judge asked the audience, which included some victims, to quiet down.
Madoff, a former chairman of the Nasdaq Stock Market, has been free on a $10 million personal recognizance bond since shortly after his arrest on Dec. 11. He has been confined to his Upper East Side apartment on 24-hour home detention and a private security company monitors the apartment’s entrances.
During his plea, Madoff said his firm’s proprietary trading and market-making operations, as well as its U.K. business, London-based Madoff Securities International Ltd., were legitimate.
The case has been closely watched. Scores of members of the media and some victims crammed into the main federal courthouse in lower Manhattan. The courtroom itself only held about 100 people, but two overflow rooms were set up in the courthouse with live video feeds of the hearing.
Helicopters and other media vehicles, carrying live video feeds, followed Madoff’s trip from his apartment to the courthouse in the pre-dawn hours on Thursday. More than a dozen television trucks were parked outside the courthouse and dozens of photographers waited outside in hopes of getting one last shot of Madoff as he entered or left the building.
Prosecutors had alleged Madoff defrauded charities, hedge funds, trusts and other investors in a massive fraud that dated back to the early 1980s.
