Butner, NC, United States (AHN) – Hedge fund trader Bernard Madoff insists that his family was unaware of his fraudulent Ponzi scheme. However, he indicated that banks and hedge funds – whom Madoff did not identify – were part of the scheme.
In the ongoing lawsuits filed by Irving Picard, the Madoff trustee charged that JPMorgan Chase, Madoff’s primary banker, aided and abetted the hedge fund trader’s fraud, but at the same time protected its investments in the BLMIS feeder funds.
Picard cited as proof that JPMorgan only reported Madoff to government officials in October 2008, but the bank did not restrict Madoff’s access to the BLMIS account, which was used to launder money from the Ponzi scheme. The lawyer said JPMorgan ignored its anti-money laundering obligations and repeatedly permitted suspicious transactions in the BLMIS account.
Madoff, now serving a 150-year sentence in North Carolina, stressed in recent interviews that the banks and hedge funds apparently played blind to his businesses. He cited as proof the financial institutions’ failure to examine discrepancies between his regulatory filings and other information he made available.
Madoff’s Ponzi scheme, which lasted 16 years, cost the loss of $20 billion in cash investments and $65 billion in paper wealth. Picard filed the lawsuit against JPMorgan to recover almost $1 billion in profits and $5.4 billion in damage
Picard cited as proof of the bank’s knowledge of Madoff’s scheme internal bank emails that bluntly warned bank executives of speculation that the hedge fund trader was running a Ponzi scheme and financial reports that were clear evidences of fraud.
Because of shame over Madoff’s crimes, his son Mark committed suicide late last year by hanging himself in his New York apartment.
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