MAdoff up to 68B stolen, government says no jury trial wtf

Expected Madoff plea troubles victims, fuels distrust
Wednesday March 11, 2009, 1:34 pm EDT
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By Grant McCool


Reuters - Bernard Madoff (R) leaves the Manhattan federal courthouse in New York March 10, 2009. REUTERS/Jacob Silberberg ...

NEW YORK (Reuters) - Some former customers of financier Bernard Madoff despise him for his fraud, but they are also angry with their government and a financial system they say robbed them of their savings.

Just a few of the thousands of bilked investors have the right to speak in a New York court on Thursday when the 70-year-old former Nasdaq chairman is expected to plead guilty to 11 criminal charges that could put him in prison for the rest of his life.

Investors said in telephone interviews Madoff's potential 150-year sentence means little to them because they want more details of the scheme he confessed to in December and where the money went.

Madoff will not face a jury trial, which would provide more evidence of his financial crimes and co-conspirators going back 20 years, and catharsis for some.

"They want this to be over so badly, it's stunning," said New York retiree Miriam Siegman, who worked for nonprofit organizations and lost her retirement money. "In a jury trial the truth has a chance of coming out."

Madoff was arrested just three months ago and has been living in his luxury apartment under house arrest. At Thursday's plea proceeding in U.S. District Court in Manhattan, the government may ask Judge Denny Chin to remove him from house arrest and jail him until sentencing.

Prosecutors now estimate that the once-respected trader and money manager's unprecedented worldwide Ponzi scheme cost investors $64.8 billion, up from the $50 billion fraud they said Madoff acknowledged.

The Ponzi scheme, in which investors were paid with the money of new clients, collapsed with last year's market meltdown.

Madoff has become to many one of the symbols of the Wall Street crisis that laid bare his crimes and those of other alleged swindlers across the United States in the past year.

"He understood to the infinitesimal detail how corrupted the system was and how easy it was really, to work it, and it remains so," Siegman said.

CHARITIES

Madoff's fraud touched hedge funds, big banks, wealthy individuals, Jewish charities and middle-class people investing for retirement in North and South America and Europe.

"All those charities? Someone is gonna die because they are not getting help from that charity," said Bennett Goldworth, a Manhattan real estate broker in his 50s who said he lost several million dollars and is no longer financially independent.

In the three months since Madoff's arrest, at least two people have been reported taking their own lives in distress over their losses with Bernard L. Madoff Investment Securities LLC.

Goldworth said the U.S. Securities and Exchange Commission (SEC) and Internal Revenue Service did not respond adequately to Madoff and other fraud.

He called Madoff "a sick, cruel man" and bemoaned the lack of a plea deal with prosecutors.

"It makes no sense ... not cooperating means he doesn't want to implicate anyone else and he does not want to give back any money," Goldworth said. "What's in it for him to do it this way?"

Over the years, the SEC received reports that Madoff was a fraud, but none of its inquiries led to charges.

"Mr. Madoff has stolen 20 years of my life," said another investor, Yale Fishman, who worked with charities that believed they were benefiting from his firm. "I worked very hard. I paid a great deal of taxes. I trusted in the system.

"It is mind-boggling to me that he kept opening charitable accounts knowing that he was robbing the weakest in society."

(Editing by Brian Moss)