Madoff Fund Made No Trades

Records of trades don't match stock prices
By Peter Fearon,  Newser Staff
Posted Jan 16, 2009 2:35 AM CST
A bystander outside Bernie Madoff's apartment building invites him to jump.   (AP Photo/ Louis Lanzano)
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(Newser) – The fund run by Wall Street swindler Bernie Madoff apparently did not execute a single trade the entire time it was raking in billions of dollars in investment cash from unsuspecting clients, reports Reuters. Monthly statements of trades from Madoff were pure fiction that kept up appearances in the $50 billion fraud, say regulators. Nevertheless, Madoff's fund managed to pass several routine examinations by SEC investigators.

"Our exams showed no evidence of trading on behalf of the investment advisor, no evidence of any customer statements being generated by the broker-dealer," said an investigator. Yet each month Madoff issued detailed summaries of pretend purchases to clients. In some cases, stock prices quoted in the statements did not match the stocks' actual prices.