Click to play videoNew York: As if the wilting economy weren't bad enough, an alleged scheme that has cost investors billions of dollars is rocking Wall Street, and federal authorities say a former chairman of the NASDAQ Stock Exchange is at the heart of it. It might be one of the biggest investment frauds ever. The arrest of Wall Street legend Bernard Madoff has clients panicked that their wealth may be gone for good.
"It's hard to believe that somebody so successful who people trusted for years is so greedy and so corrupt to steal their money. It's remarkable. The people that I have spoken to are shocked that Bernie Madoff a trusted guy would steal their money."
Madoff, a former chairman of the NASDAQ Stock Market built one of the most successful trading firms on Wall Street. It was at a separate, more secretive investment division located on a separate floor of his office that he allegedly perpetrated the fraud.
According to civil and criminal complaints, Madoff confessed he had been cheating investors for years, and he estimated his total losses from the fraud may have been $50 billion.
According to the criminal complaint filed on Wednesday, Madoff confessed to his two sons Andrew and Mark - both of whom are senior executives at the company.
The father said of his investment business: "It's all just one big lie. It was basically a giant Ponzi scheme."
Madoff allegedly had been using new investment money from clients to pay supposed profits out to other investors under the weight of a tumbling stock market. The scheme had collapsed.
One of Madoff's attorneys said, "Bernie Madoff is a long-standing leader in the financial services industry. He will fight to get through this unfortunate set of events."
Madoff is out on $10 million bail. He is facing a single count of securities fraud which could carry a prison sentence of up to 20 years.
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