SEC Settlements In Ponzi Scheme Cases: Putting Madoff And Stanford In Context

Article by Jan Larsen and Paul Hinton*

The alleged multi-billion dollar Ponzi schemes perpetrated by Bernard Madoff and Sir Allen Stanford have generated widespread media coverage. The scales of the alleged schemes in the Madoff and Stanford cases, estimated to be as large as $50 billion and $8 billion respectively, are indeed greater than in Ponzi scheme cases settled with the SEC over the last six-and-a-half years.¹

The SEC has reached settlements with over 300 defendants in cases related to alleged Ponzi schemes during this period, including settlements in 12 cases relating to Ponzi schemes with alleged fraud of $50 million or more. We provide an overview of these 12 cases and the associated SEC settlements reached to date.