Which investment firm was exposed in the 2008 scandal involving Bernard Madoff’s Ponzi scheme?

Bernard L. Madoff Investment Securities was the investment firm exposed in the 2008 Madoff Ponzi scheme.

Bernard Madoff ran the firm and had previously been a respected Wall Street figure, including service as chairman of Nasdaq. His investment-advisory operation claimed to generate steady returns, but investigators found that it did not earn those returns through a genuine trading strategy.

Instead, money from newer investors was used to pay earlier investors who requested withdrawals. Account statements showed fictitious trades and balances. The fraud unraveled during the financial crisis when clients sought approximately $1.7 billion in withdrawals and Madoff could not meet them.

Madoff was arrested on December 11, 2008. He pleaded guilty in March 2009 and received a 150-year prison sentence. The firm’s market-making business was separate from the fraudulent advisory operation, an important distinction often lost in simplified accounts of the scandal.