The London-based office of convicted con artist Bernie Madoff will not be charged in the criminal investigation into a large investment scam resulting in billions of lost investments around the world.
The United Kingdom Serious Fraud Office said their investigators have not produced enough evidence against the London branch of Madoff’s operation to “provide a realistic prospect of conviction,” Bloomberg reports. But the SFO also pointed out they will continue to investigate a handful of funds with outposts in Europe that invested with Madoff in the search of “wider aspects of the fraud.”
In March 2009, the Manhattan-based investor pleaded guilty to one of the largest recorded Ponzi schemes in history. Madoff had used funds from new investors to pay off older investments in a vast pyramid-style scam that has resulted in $13 billion of lost investments, according to U.S. prosecutors.
The conviction has sparked numerous lawsuits in Europe and the U.S. as beguiled investors untangle a complicated system carried out by Madoff. The scheme involved selling investments with no real value, on the promise of a high return that would come through in a short period of time.
Madoff Securities International was mostly owned by Madoff himself and functioned as the main office for trading, according to Bloomberg. The office staff was comprised of about 25 people, including traders, support staff and office managers.
Defense attorney Nicola Finnerty, who is representing former Madoff Securities International CEO Stephen Raven, told Bloomberg that Raven is satisfied with the decision made by the SFO, and that “he and his directors have been fully exonerated.”
One of the main facets of Madoff’s Ponzi scheme was sending sums of money back and forth between his New York and London offices. U.S. prosecutors have found about $250 million was sent back and forth between the two offices, “to give the appearance that he was conducting securities transactions on behalf of the investors, when, in fact, he was not,” according to the indictment.
Madoff, now 71, is serving 150 years in federal prison in North Carolina as the main sentencing for the criminal charges filed against him in relation to the massive fraud.
While investors who gave money to Madoff and his offices are not being investigated, several of his former staff members have come under investigators’ scrutiny.
Stanley Chais, Madoff’s former money manager, is under a criminal investigation in the U.S. for channeling money to Madoff’s “business” through other accounts, Bloomberg reported.
Madoff’s chief aide Frank DiPascali, accountant David Friehling and computer programmers Jerome O’Hara and George Perez have also been charged in connection to the widespread scam.