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November 2, 2009

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Madoff says SEC sees no Ponzi scheme

BERNARD Madoff was apparently convinced that it never even occurred to Securities and Exchange Commission staff he was running a Ponzi scheme, despite the agency's numerous probes of his business.

A document released last Friday details a prison interview conducted on June 17 by the SEC inspector general in which Madoff says he had the impression that "it never entered the SEC's mind that it was a Ponzi scheme."

There were some shades of boasting even as Madoff sat in jail a few months after pleading guilty to fraud. The only problem with officials at the SEC's Washington headquarters, Madoff said, is that he had "too much credibility with them and they dismissed" the idea of a Ponzi scheme.

The disgraced financier confided that he didn't bring an attorney with him when he testified in an inquiry by the SEC's enforcem0065nt division because he believed he didn't need one - and he was trying to fool the government investigators into thinking he had nothing to hide.

The details emerged in a summary of Inspector General David Kotz's interview with Madoff at the Metropolitan Correctional Center in New York, released along with hundreds of other documents related to Kotz's extensive investigation of the SEC's stunning failure to detect Madoff's fraudulent scheme for 16 years.

As the SEC inspectors carried out probe of his business, Madoff said in the interview he was "worried every time" that he'd be caught.


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