Madoff Allocution Statement, the 50bn scam.

Guilty plea statement by Bernard Madoff

'Your Honor, for many years up until my arrest on December 11, 2008, I operated a Ponzi scheme through the investment advisory side of my business, Bernard L. Madoff Securities LLC, which was located here in Manhattan, New York at 885 Third Avenue.

When I began the Ponzi scheme I believed it would end shortly and I would be able to extricate myself and my clients from the scheme. However, this proved difficult, and ultimately impossible, and as the years went by I realized that my arrest and this day would inevitably come.

To the best of my recollection, my fraud began in the early 1990s. At that time, the country was in a recession and this posed a problem for investments in the securities markets. Nevertheless, I had received investment commitments from certain institutional clients and understood that those clients, like all professional investors, expected to see their investments out-perform the market. While I never promised a specific rate of return to any client, I felt compelled to satisfy my clients' expectations, at any cost. I therefore claimed that I employed an investment strategy I had developed, called a "split strike conversion strategy," to falsely give the appearance to clients that I had achieved the results I believed they expected.'

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How a fraud of this magnitude ever went unnoticed for well more than a decade is perplexing. There wasn't any proper trade to speak of, no investment in stocks or securities, the money received was simply funneled into a bank account elsewehere. Investors delved into something they did not completely understand but as long it gave good returns, no one asked any questions. Most who invested were very wealthy people with personal investments in the billions. All of it turned into nothing the day of the arrest, magically transformed into thin air.