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Wednesday, December 31, 2008

Bernard Madoff Set to Disclose list of Holdings to SEC

NEW YORK (AP) -- An attorney for Bernard Madoff said the disgraced Wall Street money manager would give the Securities and Exchange Commission a list of his personal assets by 5 p.m. EST Wednesday to comply with a court order. The list will provide an account of property that could eventually be tapped to make restitution to victims of what authorities say was a massive Ponzi scheme.

The SEC declined to comment on whether it received the list or would eventually disclose its contents to the public.

Madoff's personal wealth is said to be substantial. He had mansions in the Hamptons and Palm Beach, Fla., a penthouse in Manhattan and a handful of luxury yachts. His firm operated proprietary stock trading desks in New York and London that were supposedly investing the family's vast fortune.

Still, those assets would likely cover only a fraction of the billions of dollars that investors entrusted to Madoff.

Law firms representing Madoff's clients said they were nonetheless still eager to see what might be available to repay victims.

"Like everyone else, we expect it to be made public," said attorney Matthew Gluck, a partner at Milberg LLP. Gluck added that if the SEC refuses to disclose the documents, his law firm would consider other steps to obtain the information.

Madoff's lawyer, Ira Lee Sorkin, said his client would comply with the court order Wednesday, but provided no additional details on the contents of the asset disclosure.

On Monday, a top SEC official is set to face a Congressional panel investigating the scandal.

The House Financial Services Committee, which is preparing for the most substantial rewrite of laws governing U.S. financial markets since the Great Depression, is scheduled to take testimony from SEC inspector general H. David Kotz.

A major focus of the hearing will be the inability of the SEC to unearth the scandal, said Rep. Paul Kanjorski, D-Pa., who will chair the hearing. The SEC has come under criticism for not fully investigating fraud allegations against Madoff's investment firm. SEC Chairman Christopher Cox has acknowledged that there were multiple failures by agency staff during previous inquiries.

"Sadly, Mr. Madoff's actions have further weakened the already-battered investor confidence in our securities markets," Kanjorski said in a statement. "We can, however, better understand how to reform the U.S. financial system by carefully examining this Ponzi scheme."

Madoff, 70, a former Nasdaq stock market chairman, is accused of running a scheme that paid fictitious returns to certain investors out of the principal received from others. Madoff remains under house arrest in his apartment in New York as part of an earlier bail agreement.

Associated Press Writer Larry Margasak in Washington contributed to this report.