The FBI has arrested a giant among Wall Street brokers and charged him with bilking his investors of up to $50 billion, the Wall Street Journal reports. Federal agents busted Bernard L. Madoff, a former NASDAQ chaiman, after he admitted to employees that his investment advisory business was a "giant Ponzi scheme." The SEC has begun a companion civil case.
"Our complaint alleges a stunning fraud that appears to be of epic proportions," said an SEC official. Madoff, 70, has been a major player on Wall Street for decades, the Journal notes. His firm, Bernard L. Madoff Investment Securities LLC, had $17 billion in assets at the start of the year, most of which appears to be missing. He told employees yesterday the firm was insolvent, and he planned to surrender to authorities, but wanted to pay bonuses first out of the $200-$300 million that were left.