If the federal charges prove true, and Bernie Madoff was
running the mother of all Ponzi schemes, the fraud and fallout
would be one of the largest of any financial chicanery in
modern times and would certainly be the largest investment
fraud in history. While Madoff appears to have raised funds
from a wide variety of wealthy clients and a number of funds of
funds, Madoff's activities had raised red flags for years and
prompted many investors to keep their distance. Regulators
previously looked at Madoff, as well, but apparently had not
found a smoking gun.
"The institutional hedge fund community, the funds of...