SEC Looking at Roles of Certain Madoff Employees and Vendors

The SEC has now reportedly issued a subpoena to one employee — and is about to issue a subpoena to a second employee — of a group at Bernard Madoff’s firm that dealt with clients who deposited and redeemed funds from the firm.  The WSJ reports that the subpoenas are part of the SEC’s effort to find out who else could have helped Mr. Madoff, who says he acted alone.  The group also helped generate the firm’s monthly and quarterly client statements, which are now believed to be fraudulent. Neither of the employees have been charged with any wrongdoing.

The WSJ further reports that investigators also are examining the role of Mr. Madoff’s wife, Ruth, as they have found information that she reconciled the firm’s bank accounts. Ms. Madoff has not been accused of any wrongdoing, either.

Another interesting development receiving attention from investigators is the role of vendors that did work for the Madoff firm. The WSJ reports that “to create the appearance of a legitimate investment-advisory business, Mr. Madoff paid an unnamed research firm for work, even though the Madoff firm’s investment arm made few, if any, trades for its clients.”

Read the WSJ article