A federal judge has thrown out a lawsuit alleging that the SEC is liable to investors for failing to detect Bernard Madoff's $50 billion Ponzi scheme, ruling that the agency acted within its discretion. The investors had asserted that SEC investigators ignored numerous red flags and tips regarding Madoff, and when they did investigate, failed to communicate with each other about their conclusions. The suit cited last year's SEC Office of Inspector General's report detailing how the agency failed to uncover Madoff's scheme.
Judge Tosses Investors' Madoff-Related Claims Against SEC
The National Law Journal
April 22, 2010