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Madoff Expected To Plead Guilty To Fraud

STEVE INSKEEP, host:

It's MORNING EDITION from NPR News. I'm Steve Inskeep.

LINDA WERTHEIMER, host:

And I'm Linda Wertheimer. We now have a good idea of what the future holds for Bernard Madoff. The man believed responsible for the largest Ponzi scheme in history has now been charged with 11 criminal counts. His lawyer says Madoff will plead guilty to everything tomorrow, and that would likely mean life in prison. NPR's Robert Smith has more.

ROBERT SMITH: The revelation that Madoff will plead guilty came without warning in a federal courtroom yesterday. It was supposed to be a routine hearing, a conflict of interest allegation against Madoff's lawyer. And so there wasn't much tension. No investors were there to testify. No protestors outside. But then Judge Denny Chin surprised everyone with a question to Madoff's lawyer: I gather it is the expectation that your client will plead guilty?

Ira Sorkin, the attorney, hedged a little. He said, I think that's a fair expectation. And so the judge followed up: Guilty to all 11 counts? Madoff's lawyer said, yes, your honor.

Madoff sat quietly with his shoulders slumped as the list was read off: two counts of fraud for soliciting billions of dollars and then not investing it, wire and mail fraud for sending out thousands of fake statements, three counts of money laundering for funneling the cash through European accounts to make it look like investment profits, and several counts of lying about the whole thing. The maximum sentence for all those crimes: 150 years. And that's not all.

Prosecutors will ask for full restitution of a loss they now estimate at $64 billion. And they reserve the right to go after $170 billion, which includes all the assets ever touched by Madoff. That's the one point it seems like Madoff will challenge.

His lawyer told the court that they'd like to see how the government came up with those huge numbers. He pointed out that some investors made money from Madoff, and it's difficult to identify the real victims. Difficult or not, Madoff might have to face a group of them tomorrow when he returns to the judge to give him his expected guilty plea. At least 25 of his investors have asked to address the court.

Judge Chin says that he knows that emotions are high in this case, and that many of the victims are worried that a plea bargain might be in the works. And so the judge made it clear: There is no plea deal. If Madoff chooses to plead guilty, he'll have to plead guilty to all 11 counts.

At the end of the hearing, there was one big question unanswered: Did Bernard Madoff do this alone? Prosecutors didn't charge him with conspiracy. No one else was mentioned in the documents. But prosecutors did end their statement with this line: Our investigation is continuing.

Robert Smith, NPR News, New York. Transcript provided by NPR, Copyright NPR.

Robert Smith
Robert Smith is a host for NPR's Planet Money where he tells stories about how the global economy is affecting our lives.
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