'Ashamed' Madoff Pleads Guilty, Goes To Jail

'Ashamed' Madoff Pleads Guilty, Goes To Jail
Sentencing Set For June 16 From newsnet5.com out of Cleveland, OH

NEW YORK -- A New York judge had to rein in a courtroom packed with seething fraud victims Thursday during the hearing in which Bernard Madoff pleaded guilty to what may be Wall Street's biggest ever scam.

Spectators cheered when the disgraced financier was led off to jail immediately following his guilty pleas. He had spent the past three months under house arrest in his $7 million Manhattan penthouse.

When his lawyer described the bail conditions and how Madoff had, "at his wife's own expense," paid for private security, loud laughter erupted. The judge warned the crowd to remain silent.

Madoff said he is "deeply sorry and ashamed" for the Ponzi scheme that wiped out savings accounts worldwide.

"I am painfully aware that I have deeply hurt many, many people, including the members of my family, my closest friends, business associates and the thousands of clients who gave me their money," Madoff said.

He said that as he engaged in his fraud, he knew what he was doing was wrong but that he believed "it would end shortly and I would be able to extricate myself and my clients from the scheme."

"However, this proved difficult, and ultimately impossible, and as the years went by I realized that my arrest and this day would inevitably come," Madoff said.

The judge revoked bail Thursday after Madoff pleaded guilty to all 11 charges against him, including securities fraud and perjury. He was accused of engineering one of the largest investment scams in U.S. history.

The judge said the 70-year-old former Nasdaq chairman has the means to flee and an incentive to do so because of his age.

A sentencing date of June 16 has been set. He could face up to 150 years in prison.

Madoff told the judge in U.S. District Court in New York that his Ponzi scheme began in the early 1990s in response to that era's recession.

Madoff's plea came three months after he admitted that his once-revered investment fund was all a big lie -- a Ponzi scheme that defrauded billions of dollars worldwide from retirees, charities, school trusts and even Holocaust survivors.

The scam quickly turned Madoff into one of the most vilified men in the world, as thousands of investors came forward to say they were defrauded.

Madoff Avoids Victims' Eyes

Three victims of the fraud confronted him in court, one trying to address Madoff directly saying, "I don't know if you had a chance to turn around and look at the victims."

Madoff avoided eye contact with the three investors who spoke. The judge directed him to speak directly to the bench.

Two investors said they opposed the guilty plea. One said she wanted it to wait until the lost money is found.

At least 25 Madoff investors asked to speak under provisions allowing victims of crime to appear at a plea hearing.

Some victims in the scandal want the accused Wall Street swindler to name any possible accomplices who helped him pull off his multibillion-dollar securities fraud. They also want Madoff to apologize and turn over family assets that might be used to pay bilked investors.

Alexandra Penney said she's furious with Madoff. But she's just as angry with the Securities and Exchange Commission. The 60-year-old artist and former magazine editor said Madoff took everything she had saved from the age of 16.

Penney wasn't in court for the guilty plea. She's in Florida.

In addition to prison time, Madoff faces mandatory restitution to victims, forfeiture of ill-gotten gains and criminal fines.

Investigators are still unraveling how he pulled off the fraud for years without being caught. They suspect that his family and top lieutenants who helped run his operation from its midtown Manhattan headquarters may have been involved.