The lawyer for Bernard Madoff , who is accused of running a fraudulent Wall Street investment scheme, says there is a "fair expectation" his client will plead guilty to 11 criminal counts submitted by US prosecutors.
AFP - Fallen Wall Street baron Bernard Madoff confirmed Tuesday he is set to plead guilty to a massive multi-billion dollar fraud as prosecutors said he should spend the rest of his life in prison.
Madoff, 70, said through his lawyer that he expects to plead guilty at a hearing Thursday to the 11 counts of fraud announced by prosecutors on Tuesday.
"That is a fair expectation," defense lawyer Ira Sorkin said.
The charges carry a maximum prison sentence of 150 years.
Dressed in a dark suit and sporting gray swept-back hair, Madoff looked ahead without expression in a courtroom packed with dozens of journalists.
He was arrested in December after allegedly confessing to a 50 billion dollar pyramid scheme, or Ponzi fraud, in which money is stolen from new investors to pay phony profits to existing clients.
Prosecutors charged him with "a scheme to defraud the clients... by soliciting billions of dollars of funds under false pretenses."
"There is no plea agreement," federal prosecutor Marc Litt told the court. "He must plead guilty to all 11 counts."
Prosecutors say Madoff's scam started from at least the 1980s and lasted right up to his arrest.
Victims' lawyers believe some three million people, including major banks, celebrities, charities and universities, lost money.
So far Madoff is the only person charged. However, prosecutors say their investigation is continuing.
The former chairman of the Nasdaq Stock Exchange and Wall Street trading guru has been holed up since his arrest under strict 10 million dollar bail in his luxury New York apartment.
A guilty plea on Thursday would mean he gives up his right to a trial.
Judge Denny Chin told the court that he would decide on Thursday whether Madoff should be taken into custody or be allowed to remain under house arrest until sentencing.
"Sentencing would not take place for several months," Chin said.
In a highly unusual move, victims of Madoff's alleged fraud are to be given the right to speak at Thursday's hearing -- provided they restrain their anger.
"I understand emotions are high," Chin said, but those appearing must "conduct themselves in a manner appropriate to a court room."
Tuesday's session was held to resolve a conflict-of-interest issue with Sorkin, whose family had invested with Madoff and who once represented two of his business associates in a separate case.
Madoff, grim-faced and speaking in a subdued voice, told the judge he wished to keep Sorkin as his attorney. This was granted.
The developments spelled the beginning of the end for a self-made man who rose from obscurity to become a key member of the ultra-wealthy echelons of the US Jewish community and a noted Wall Street innovator.
Acting US Attorney Lev Dassin said in a statement that Madoff committed "an extraordinary array of crimes" over two decades.
"While the alleged crimes are not novel, the size and scope of Mr Madoff's fraud are unprecedented."
The criminal information outlining 11 felony charges -- including securities fraud, investment adviser fraud, mail fraud, wire fraud, and money laundering -- shed new light on the workings of the alleged scam.
According to prosecutors, Madoff secured billions of dollars from investors, encouraging them with rock-solid profits and in some cases promises of "annual returns in varying amounts of up to approximately 46 percent per year."
But instead of investing the money, he was recycling the funds "to meet the periodic redemption requests of other investors."
Meanwhile, other funds were stolen "to purchase and maintain property and services for the personal use and benefit of Madoff, his family members, and associates," prosecutors said.
To cover up his fraud, Madoff "repeatedly lied" to regulators and conned his clients with impressive-looking offices.
In the two weeks before Madoff's arrest, his company claimed to serve 4,800 client accounts with a balance of 64.8 billion dollars, but the prosecution said Madoff's firm held only "a small fraction of that."
Whether Madoff feels remorse was not yet known.
Sorkin said it was impossible to know the number of victims because many clients had "received redemptions that exceeded the money they lost."
Sorkin said he did not want "to suggest there were no victims," but that there is "difficulty to identify the real victims."
Date created : 2009-03-11