Madoff’s $50bn fraud sends shockwaves worldwide

and Exchange Commission
(SEC) has come under sharp criticism after it
discovered late last week Bernard L Madoff Investment Securities had allegedly
been trading while insolvent for decades without being detected, with losses of
$50bn (£34bn).

BNP Paribas SA, Europe’s third-biggest bank told
it stands to lose as much as €350m through indirect exposure to Bernard Madoff’s
investment advisory business if the assets of its hedge funds are ‘nil’, while
Spanish Santander bank had more than €2.33bn (£2.08bn) worth of exposure,
The Times reports.

Madoff, a former NASDAQ chairman, was arrested last Thursday in New York,
after confessing to his two sons, senior Madoff executives, he had been
operating a Ponzi scheme for decades – which pays early investors with money
raised from new investors – possibly wiping out fortunes of many wealthy
American socialites who reportedly queued up to be allowed to join his select
client list, according to The Independent.

In the UK, Nicola Horlick’s hedge-fund manager Bramdean Alternatives appears
to have lost at least £10m. In addition, it is understood Japanese brokerage
house Nomura, which took over the Lehman Brothers European business, is also
among the victims.

Further reading:

The Times story

The Independent story

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