FINRA Probes Brokerages That Sent Clients to Madoff

A national securities watchdog is calling for brokerages that sent clients to Bernard Madoff's hedge fund to reveal the names of those referred and the fees obtained by doing so.

In a Jan. 15 letter, the Financial Industry Regulatory Authority also asks securities brokerages to provide due diligence and marketing materials concerning the Madoff fund, as well as a list of clients referred to non-Madoff funds, reports Bloomberg.

“What this really highlights is that this is an all-hands-on-deck investigative and enforcement effort,” attorney Jacob Frenkel of Shulman Rogers Gandal Pordy & Ecker tells the news agency. “If there’s a regulatory agency that has jurisdiction, it’s looking and it will act.”

As discussed in earlier ABAJournal.com posts, Madoff is accused by federal prosecutors of having masterminded a record-breaking $50 billion Ponzi scheme run under the guise of a hedge fund.