Compliance April 19, 2011

Madoff-Related Lawsuit against SEC Dismissed

A federal judge threw out a lawsuit by two of Bernard Madoff's former clients, which accused the Securities and Exchange Commission (SEC) of negligence for failing to uncover Madoff’s Ponzi scheme.

Reported by

PLANADVISER staff

Reuters reports that U.S. District Judge Laura Taylor Swain of the U.S. District Court for the Southern District of New York said the plaintiffs failed to identify any statute or rule governing how the SEC should have been investigating Madoff prior to his December 2008 arrest.

The lawyer for the investors said he was disappointed with the ruling. An SEC spokesman did not immediately return a phone call from Reuters seeking comment.