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Madoff faces sentencing in court Madoff faces sentencing in court
(11 minutes later)
A crowd of spectators has arrived at a New York court to witness Bernard Madoff being sentenced for plotting a $50bn (£30.3bn) investment fraud. Bernard Madoff has arrived at a New York court to be sentenced for masterminding a fraud that he claimed had robbed investors of $50bn (£30bn).
The disgraced financier, 71, who pleaded guilty to 11 charges in March, could face a sentence of 150 years. Hundreds of spectators were waiting at the court, including victims of the scandal, to witness the sentencing.
Madoff's lawyer is asking for a 12-year sentence. The hearing is scheduled to start at 1000 local time (1400 GMT). Madoff, 71, pleaded guilty to 11 charges in March and could face a sentence of 150 years.
Prosecutors have promised to seize his assets, but it remains unclear if investors will get any money back. But his lawyer is asking for a 12-year sentence. It remains unclear if investors will get any money back.
The $50bn figure is the amount that Madoff estimated was the size of his fraud when he was questioned at his New York appartment in December last year.The $50bn figure is the amount that Madoff estimated was the size of his fraud when he was questioned at his New York appartment in December last year.
In a preliminary hearing on Friday, District Judge Denny Chin ordered Madoff to forfeit $171bn in assets, while his wife Ruth had to forfeit more than $80m in net worth she claimed was hers.In a preliminary hearing on Friday, District Judge Denny Chin ordered Madoff to forfeit $171bn in assets, while his wife Ruth had to forfeit more than $80m in net worth she claimed was hers.
Victims of Bernie Madoff's scam, Cindy and Richard FriedmanVictims of Bernie Madoff's scam, Cindy and Richard Friedman
The giant figure Madoff was ordered to forfeit was equal to the sum prosecutors said had passed through his investment firm over the years. In practice, however, such funds do not exist.The giant figure Madoff was ordered to forfeit was equal to the sum prosecutors said had passed through his investment firm over the years. In practice, however, such funds do not exist.
Under the order the Madoffs must sell a $7m Manhattan apartment where Ruth Madoff lives.Under the order the Madoffs must sell a $7m Manhattan apartment where Ruth Madoff lives.
Other assets to be sold include an $11m estate in Palm Beach, Florida, a $4m home in Montauk and a $2.2m boat.Other assets to be sold include an $11m estate in Palm Beach, Florida, a $4m home in Montauk and a $2.2m boat.
But an agreement with prosecutors has enabled Ruth Madoff to keep $2.5m in cash.But an agreement with prosecutors has enabled Ruth Madoff to keep $2.5m in cash.
The trustee winding down the Madoff firm has collected $1.2bn to return to investors.The trustee winding down the Madoff firm has collected $1.2bn to return to investors.
Life savingsLife savings
Bernard Madoff has admitted defrauding thousands of investors in a Ponzi scheme which he said had been running since the early 1990s.Bernard Madoff has admitted defrauding thousands of investors in a Ponzi scheme which he said had been running since the early 1990s.
The 11 charges he pleaded guilty to included securities fraud and money laundering.The 11 charges he pleaded guilty to included securities fraud and money laundering.
Many investors have written to the judge, with some saying entire life savings have been lost and mortgages are not being paid, following the fraud.Many investors have written to the judge, with some saying entire life savings have been lost and mortgages are not being paid, following the fraud.
Only 10 have said they wish to speak out in court. Madoff will read a statement before the judge hands down a decision.Only 10 have said they wish to speak out in court. Madoff will read a statement before the judge hands down a decision.
'High sentence''High sentence'
According to court papers, 1,341 account-holders lost a total of about $13bn in the fraud.According to court papers, 1,341 account-holders lost a total of about $13bn in the fraud.
WHAT IS A PONZI SCHEME? A fraudulent investment scheme paying investors from money paid in by other investors rather than real profitsNamed after Charles Ponzi who notoriously used the technique in the United States in the 1920s Differs from pyramid selling in that individuals all tend to invest with the same person Madoff victims lose life savings Suicide prompted by Madoff scandalWHAT IS A PONZI SCHEME? A fraudulent investment scheme paying investors from money paid in by other investors rather than real profitsNamed after Charles Ponzi who notoriously used the technique in the United States in the 1920s Differs from pyramid selling in that individuals all tend to invest with the same person Madoff victims lose life savings Suicide prompted by Madoff scandal
Ira Sorkin, Madoff's lawyer, said his client "will speak to the shame he has felt and to the pain he has caused".Ira Sorkin, Madoff's lawyer, said his client "will speak to the shame he has felt and to the pain he has caused".
"We seek neither mercy nor sympathy," said Mr Sorkin. But he has asked Judge Chin to "set aside the emotion and hysteria attendant to this case," as he determines the sentence."We seek neither mercy nor sympathy," said Mr Sorkin. But he has asked Judge Chin to "set aside the emotion and hysteria attendant to this case," as he determines the sentence.
However, the sentence is expected to be long.However, the sentence is expected to be long.
"Given the enormous amount of funds he has stolen and the number of victims, the sentence is going to be very, very high," said Paul Radvany, a law professor at Fordham University in New York."Given the enormous amount of funds he has stolen and the number of victims, the sentence is going to be very, very high," said Paul Radvany, a law professor at Fordham University in New York.
The hearing will take place in a courtroom that can accommodate 250 people.The hearing will take place in a courtroom that can accommodate 250 people.
Two separate rooms in lower Manhattan courthouse will house former investors and spectators to watch on closed-circuit TV.Two separate rooms in lower Manhattan courthouse will house former investors and spectators to watch on closed-circuit TV.
RetirementRetirement
The list of Madoff's investors includes film director Steven Spielberg's charitable foundation, Wunderkinder.The list of Madoff's investors includes film director Steven Spielberg's charitable foundation, Wunderkinder.
We really did need that money very much. I am in constant anguish Karen Audet, Former Madoff investorWe really did need that money very much. I am in constant anguish Karen Audet, Former Madoff investor
UK banks were also among the victims with HSBC Holdings saying it had exposure of around $1bn. Other corporate victims were Royal Bank of Scotland and Man Group and Japan's Nomura Holdings.UK banks were also among the victims with HSBC Holdings saying it had exposure of around $1bn. Other corporate victims were Royal Bank of Scotland and Man Group and Japan's Nomura Holdings.
But it is not just the elite and large firms who were victims of the fraud.But it is not just the elite and large firms who were victims of the fraud.
School teachers, farmers, mechanics and many others have also lost money.School teachers, farmers, mechanics and many others have also lost money.
Many had benefited from their investments until Madoff was arrested in December.Many had benefited from their investments until Madoff was arrested in December.
Karen Audet, a retired elementary school teacher in Florida, faces an uncertain future.Karen Audet, a retired elementary school teacher in Florida, faces an uncertain future.
She put $225,000 from her retirement plan into a fund run by a member of her church, who subsequently invested it with Madoff.She put $225,000 from her retirement plan into a fund run by a member of her church, who subsequently invested it with Madoff.
"We really did need that money very much," she told the AP news agency. "I am in constant anguish.""We really did need that money very much," she told the AP news agency. "I am in constant anguish."
Nasdaq chairmanNasdaq chairman
Madoff started his financial career aged 22 with $5,000 from money made from summer holiday jobs such as working as a garden sprinkler installer in New York.Madoff started his financial career aged 22 with $5,000 from money made from summer holiday jobs such as working as a garden sprinkler installer in New York.
He then set up Bernard L Madoff Investment Securities in 1960.He then set up Bernard L Madoff Investment Securities in 1960.
His firm became one of the largest market-makers - matching buyers and sellers of stocks - and Madoff served as chairman of the Nasdaq stock exchange.His firm became one of the largest market-makers - matching buyers and sellers of stocks - and Madoff served as chairman of the Nasdaq stock exchange.
As well as wealthy individuals, investment advisory firms were key Madoff investors.As well as wealthy individuals, investment advisory firms were key Madoff investors.
Madoff's firm was investigated eight times by the US Securities and Exchange Commission over the past 16 years, because it made exceptional returns.Madoff's firm was investigated eight times by the US Securities and Exchange Commission over the past 16 years, because it made exceptional returns.
But it was the global recession which effectively prompted Madoff's demise as investors, hit by the downturn, tried to withdraw about $7bn from his funds and he could not find the money to cover it.But it was the global recession which effectively prompted Madoff's demise as investors, hit by the downturn, tried to withdraw about $7bn from his funds and he could not find the money to cover it.
He has always insisted he acted alone in masterminding the fraud.He has always insisted he acted alone in masterminding the fraud.
The only other person who has been charged is his accountant David Friehling, 49, with aiding and abetting fraud, and four counts of filing false audit reports. He has been released on bail.The only other person who has been charged is his accountant David Friehling, 49, with aiding and abetting fraud, and four counts of filing false audit reports. He has been released on bail.
Though Mr Friehling was not charged with knowledge of the Madoff Ponzi scheme, he was charged with deceiving investors by falsely certifying that he audited the financial statements.Though Mr Friehling was not charged with knowledge of the Madoff Ponzi scheme, he was charged with deceiving investors by falsely certifying that he audited the financial statements.