Dave Rice 4:30 p.m., Sept. 19
State Sues Beverly Hills Middleman Who Fed Money to Madoff
The attorney general's office today (Sept. 22) filed a fraud suit against Stanley Chais of Beverly Hills, who called himself a money manager. For decades, he convinced investors that he was a wizard who could beat the market by investing in derivatives, stocks, currencies and futures, and dabbling in arbitrage according to the AG. Actually, he simply passed his clients' money to Ponzi schemer Bernie Madoff, says the state. The Chais funds reported annual gains of between 20% and 25% with only three months of negative returns between 1996 and 2007. Chais allegedly told Madoff that he didn't want any losses on trades, and Madoff accommodated his desire. Chais's investors didn't know about Madoff, according to the AG. Chais charged his investors an astronomical 25 percent yearly fee and in doing so raked in $270 million. The Securities and Exchange Commission earlier made charges against Chais.