Ian Pike 10:37 a.m., May 20
No Plea Deal for Madoff; Could Spend Remaining Days in Prison
There will be no plea agreement for notorious New York Ponzi schemer Bernard Madoff, a prosecutor said in Manhattan court this afternoon. Because of certain procedures last week, skeptics worried that Madoff, who has confessed to running a $50 billion Ponzi scheme, would cop a plea and get off light. But he is expected to plead guilty later this week. He is charged with 11 felonies, including securities, investment advisory, mail, and wire fraud; three counts of money laundering; false statements; perjury; false filings to the Securities and Exchange Commission, and theft from an employee benefit plan. He could get more than 100 years. At age 70, he is likely to spend the rest of his life behind bars. He solicited billions of dollars from investors since at least the 1980s, but most of the money went out the door to meet investors' requests. Prosecutors said he hired dozens of employees with little no experience in finance to generate false trading records and monthly statements. Some investors were promised annual returns as high as 46 percent. He is charged with transferring $250 million of clients' money to the firm's supposedly-independent market-making business, run by his two sons on another floor of the building occupied by the firm. On Nov. 30, Madoff reported having 4,800 clients with $64.8 billion under management. But in fact, he "only held a small fraction of that on behalf of his clients," says the government. In September, Madoff got $10 million from 35 labor unions and "converted those funds to his use and the use of others," according to the government.