Madoff Pleads Guilty To All Charges

Bernie Madoff pled guilty to all charges in a Manhattan courtroom today.

Madoff arrived at the federal courthouse Thursday morning and delivered on his lawyer's prediction that he would plead guilty to all 11 felony charges brought by prosecutors.

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The gray-haired 70-year-old Madoff, looking grim in a gray suit, walked into the Manhattan federal courthouse at 7:19 a.m. ET after being escorted passed dozens of photographers and TV crews in the early morning light. The plea proceeding was scheduled for 10 a.m. EDT.

Victims of Madoff's Ponzi scheme, which drew in as much as $65 billion over two decades before the 2008 market meltdown, have been invited to speak when the former Nasdaq stock market chairman is expected to admit to 11 criminal charges.

"This is not going to be a quiet, sober, dignified group," said John Coffee, professor at Columbia Law School in New York, said of the fraud victims. "I think this is going to be a bloodthirsty mob."

The plea ends half-century career that saw him rise to Nasdaq chairman and one of Wall Street's elite, and could result in a maximum prison term of 150 years.

The plea marked the first time Madoff, 70, has spoken publicly about the scheme. The judge must hear him describe his crimes in his own words to accept it.

U.S. District Judge Denny Chin said that, assuming Madoff goes forward with plans for a guilty plea, he will give investors a chance to challenge his conclusion whether to accept a guilty plea to securities fraud and perjury, among other charges. He also will let burned investors challenge his decision whether Madoff should be allowed to await sentencing in his $7 million Manhattan penthouse or immediately go to prison.

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Madoff's current bail status "really infuriates everyone," said Matt Weinstein, a motivational speaker who lost the bulk of his savings in the scheme.

"People can't even afford rent anymore," Weinstein said. "He can't go on in this palace of denial."

In three months, Madoff has gone from a man known mostly as a pioneer of electronic trading in securities to an icon for disreputable money managers who live a life of affluence while fleecing those who entrust their life savings to their schemes.

His investors included hedge funds, banks, Jewish charities, the wealthy and small individual investors in North and South America and Europe.

The FBI claimed Madoff admitted to his sons months ago that his once-revered investment fund was all a big lie, a $50 billion Ponzi scheme that wiped out life fortunes, school trusts and charities and apparently pushed at least two investors to commit suicide.

The size of the scandal has made him an international symbol of greed and deception in difficult economic times. But it remains in dispute.

Prosecutors filed papers Tuesday saying Madoff's investment company reported a total balance of $64.8 billion in November even though it actually had only a small fraction of that amount.

>>CNBC.com will have live coverage of the hearing throughout the day.

Investigators say the true amount lost by investors may be between $10 billion and $17 billion and the larger estimates by Madoff include the false profits prosecutors say he generated with tens of thousands of bogus account statements cataloguing steady profits.

The former Wall Street trader and investment adviser is the only person charged in what was a family run business, but questions remain about the case, including whether anyone else will face criminal prosecution.

So far, authorities have located only about $1 billion in assets.

In a hearing Tuesday, the judge said he had been contacted by clients of Madoff's investment firm who complained-- mistakenly--that he was benefiting from a plea deal. Prosecutors said there was no agreement that would have given him a shot at a lighter sentence in exchange for cooperating with investigators.

Sharon Lorimer Madoff Securities International London Headquarters

"There is no plea bargain here," the judge said.

Despite the anticipated plea, investigators say they still would face the daunting task of unraveling how Madoff pulled off the fraud for decades without being caught. They suspect his family and his top lieutenants, who helped run his operation from its midtown Manhattan headquarters, may have been involved.

In court documents, prosecutors have indicated that low-level employees were in on the scam and may be cooperating.

Court papers say Madoff hired many people with little or no training or experience in the securities industry to serve as a secretive "back office" for his investment advisory business.

Prosecutors say he generated or had employees generate tens of thousands of account statements and other documents, operating a massive Ponzi scheme, a scam in which people are persuaded to invest in a fraudulent operation that promises unusually high returns.

The money Madoff received was never invested but was used by him, his business and others or, as occurs in Ponzi schemes, was paid out to early investors, prosecutors said.

Slideshow: A Rogues' Gallery of Financial Crime

Some TV stations, broadcasting live, followed Madoff's vehicle by helicopter when it left the luxury apartment building where he has been under house arrest. The media frenzy surrounding Madoff has swelled as he became one of the most vilified people in America, one symbol of the financial crisis.

Judge Chin, perhaps anticipating drama not seen in Manhattan federal court since proceedings involving other well-known corporate defendants such as Martha Stewart, Bernard Ebbers and Michael Milken, has urged investors to keep their emotions in check.

"I understand that emotions are high but we have to remember to conduct ourselves in the manner that is appropriate to a courtroom proceeding," he said at the hearing Tuesday.

—CNBC.com staff, Reuters and AP contributed to this story.

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