Who did Bernie swindle?

That would be Bernie Madoff, who has been charged in connection with a decades-long Ponzi scheme that could involve as much as $50 billion. Madoff's asset management business always delivered steady returns, even though many had suspected he was running a rigged shop. Madoff, 70, told employees before his arrest that his firm, Bernard L. Madoff Investment Securities, was "one big lie." Christopher Miller, CEO of a London hedge fund ratings agency told the WSJ that "there will be a monumental impact for the hedge fund industry, it could be larger than Enron. From John Carney at ClusterStock:

He consistently told clients that his firm was earnings 1% to 2% per month, even as the rest of the market tanked and asset management clients saw losses at other firms. Honest asset managers were frustrated because they knew Madoff's returns were all but impossible but clients didn't care: they just wanted the returns. Yesterday, when news of Madoff's arrest broke in the Wall Street Journal, spontaneous applause broke out in the asset management offices of at least one prominent Wall Street firm. "At last we were free from this awful man," one Wall Streeter said.

From Bloomberg:

Madoff’s firm told investors it had just eight losing months in seven years, returns that were difficult for some to resist. “It was just too easy to sell,” said Salomon Konig, chief investment officer for Artemis Capital Partners LLC in Aventura, Florida, which invests with hedge funds. “Whenever a fund had money with Madoff, it raised a red flag,” said Konig, who said he rejected at least 20 funds of funds as potential investments for that reason alone. “It means that they didn’t do their due diligence they were supposed to and were chasing those returns.”

Of course, everyone is wondering who got snookered. From the Journal:

Ira Roth, a New Jersey resident, who says his family has about $1 million invested through Mr. Madoff's firm, is "in a state of panic." He said his 86-year-old mother-in-law has been living on the investments' returns, and he has been using the funds to pay college tuition. "This is going to kill so many people," said a current investor in Mr. Madoff's fund. "It's absolutely awful."

[CUT]

The Palm Beach Country Club, the exclusive golf and beach club in Palm Beach that counts some of the island's richest residents as members, served as a major distribution channel for Mr. Madoff's fund. According to two members of the club, Mr. Madoff had an agent and at least one major investor at the club who would help attract new investors for the fund. Some members were told by other members that one of the benefits of joining the Palm Beach Country Club was being able to invest with Mr. Madoff. "They always sold the fund as being 'regular variable income,'" said one Palm Beach Club member. "But no one really knew what the strategy was."

Jewish Journal Editor Rob Eshman posts about the scandal under the headline "Is Bernie Madoff Jewish? Very. Oy."

"A lot of Jewish charities had investments with him," one prominent investor -- who said he had no connection to Madoff -- told The Jewish Journal. "So did a lot of Jews." The collapse of the Madoff business leaves a mess that is yet to be sorted out and whose victims are just coming to the fore. But what's already clear is that Madoff used his ties to the Jewish community to garner at least some of his ill-used funds.

I’ve yet to come across lots of big L.A. connections. But trust me, they're around.