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Madoff scam went back further than thought: US

02 october 2012, 16:41
Bernard Madoff. Photo courtesy of diariouno.com.ar
Bernard Madoff. Photo courtesy of diariouno.com.ar
Bernard Madoff's multi-billion dollar Wall Street fraud started in the early 1970s, at least two decades earlier than previously thought, AFP reports citing officials.

The revelation was contained in a superseding indictment that adds charges against five former employees of Madoff's investment firm who are accused of conspiring to defraud clients in the biggest pyramid scheme in US history.

The alleged new crimes in the indictment include bank fraud charges and tax offenses, the federal prosecutor's office in Manhattan said.

Most noteworthy in the new indictment, however, is that officials now think Madoff's scheme to rip off his clients started much earlier than previously determined.

"Whereas the November 2010 Indictment alleged that the conspiracy to defraud BLMIS's clients began in or about 1992, the Superseding Indictment dates the conspiracy back to at least the early 1970s," the prosecutor's office said in a statement.

"With the new charges we announce today against these five previously indicted defendants, the architecture of Madoff's house of cards and each defendant's alleged role in it becomes clearer," Manhattan US Attorney Preet Bharara said.

FBI Acting assistant director-in-charge Mary Galligan said the five defendants were "at the core" of Madoff's virtual money machine.

"This largest-ever Ponzi scheme was not the work of one person. Each of the defendants in his or her way allegedly played a key role in designing, building or maintaining the house of cards," she said.

Madoff, 74, is serving a 150 year prison sentence.

Shielded by a reputation as one of Wall Street's most savvy investors, he secretly stole clients' capital to pay back steady returns in phony profits. The scheme only collapsed in 2008 amid the US financial crisis.

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