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Falsified records found at Madoff firm

Posted on: Tuesday, 16 December 2008, 15:49 CST

U.S. investigators said they had uncovered records at Bernard L. Madoff Investments Securities LLC that appear to be fraudulent.

Stephen Harbeck, chief executive officer of Securities Investor Protection Corp, the nonprofit firm helping liquidate the company, said investigators had found falsified records, The Wall Street Journal reported Tuesday.

Some customer statements do not reflect securities in the firm's possession, Harbeck said.

Madoff was charged with securities fraud Thursday after his sons notified authorities that he had told them he had taken $50 billion from investors in a case the Securities and Exchange Commission says is one of the biggest fraud schemes in U.S. history.

Financial analysts expressed concern about Madoff on several occasions, including 1999, when the SEC was told in a letter that Madoff was running a Ponzi scheme, The Washington Post reported Monday. However, the SEC did not examine the operation until last week, the newspaper said.

Regulators may have overlooked the irregularities because Madoff also operated a legitimate business, the Post said. He was involved in the creation of Nasdaq, a contributor to political campaigns and an adviser to the SEC.

Large banks and a number of celebrities have lost money as a result of the company's practices.

Source: United Press International

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