Bernard Madoff has been charged with masterminding a Ponzi scheme that has allegedly bilked investors out of $50 billion. Is there anybody out there that believes that he did this all by himself?

The layers of the onion have been peeling away since Madoff’s arrest revealing that many knew about, long before his arrest, that the money was gone.…..and they kept their mouths shut and continue to feed Madoff’s scam with more money from investors.

The Lang Report has published four articles, or layers of the onion, since December 18^th revealing more “stomach turning” information on a scam that has not only ruined the lives of many investors but has had far-reaching impacts on many supported charities and the U.S. economy as a whole:

• Bernard Madoff says He ‘Made Off’ with Money All By Himself
• Bernard Madoff’s Theivery Reaches Far and Touches Many
• Bernard Madoff Could Have Been Stopped 17 Years Ago….WHAT HAPPENED?
• Bernard Madoff – Another Layer “of the Onion” is Peeled Away

Now is it coming to light that when federal investigators first examined whether Bernard Madoff ran a Ponzi scheme 17 years ago, they focused on Frank Avellino, an accountant who had delivered investors to Madoff since the 1960s. This, we already knew.

But now the plot thickens…. 

Court documents filed in recent weeks in the wealthy Massachusetts island of Nantucket suggest Avellino continued to channel money to Madoff and may have known crucial information about the losses a week before the revelation of Madoff’s suspected $50 billion Ponzi scheme shocked world financial markets.

Nevena Ivanova, a Bulgarian who cleaned Avellino’s summer home in Nantucket, said in court papers filed in Nantucket District Court on December 29 that she invested her family’s $200,000 savings with him and was told the money was gone on December 1 — 10 days before Madoff’s arrest.

"It’s an indicator that he may have known what the Madoff scheme was all about," said Jay Gould, a former investment- management attorney at the Securities and Exchange Commission who heads the hedge-fund practice at Pillsbury Winthrop Shaw and Pittman LLP.

"Did Madoff tell him ‘look, your money is gone. You’re not going to get it back.’ Is that why he knew? Or is it that he didn’t know and he wasn’t a participant, but he took money from these other people and didn’t intend to give it back. It’s hard to say."

Avellino’s lawyer did not return calls. Two other investors have filed a lawsuit against Avellino in Nantucket seeking to recover more than $1 million lost to Madoff. But legal experts say Ivanova’s case is unique in suggesting a Madoff middleman may have known of the losses before Madoff’s arrest.

The Nantucket cases look set to renew scrutiny on Avellino, who in 1992 with fellow accountant Michael Bienes was brought before the Securities and Exchange Commission for illegally raising $440 million for Madoff.

In that case, Avellino and Bienes were accused of offering notes that promised returns of between 13.5 percent and 20 percent since about 1962. They operated a so-called "feeder fund," handing the money over to Madoff to invest. It became so profitable they scrapped their accounting business in 1984 to focus purely on securities trading, court documents show.

The SEC shut the operation in 1992 for selling unregistered shares. The two neither admitted nor denied liability, but agreed to pay a fine and repay investors in a settlement that forced Madoff to return the money they raised for him.

They were represented by Ira Sorkin, Madoff’s current attorney. The SEC mentioned the fund’s steady promised yearly returns, but Madoff was never sued in the case, which some view in hindsight as a missed opportunity.

ACCOMPLICES?

Madoff, a former chairman of the Nasdaq Stock Market who was a force on Wall Street for nearly 50 years, allegedly confessed to his sons on December 10 that the firm’s investment- advisory business was "basically a giant Ponzi scheme" and "one big lie," according to court documents.

He estimated losses of at least $50 billion from the scheme, which uses money from new investors to pay distributions and redemptions to existing investors. Such schemes typically collapse when new funds dry up.

It remains unclear whether he had accomplices. Harry Markopolos, a former investment manager who tried to warn U.S. regulators about Madoff, told a congressional hearing on Wednesday that Madoff could not have acted alone, citing accountants and people helping convey money to his scheme.

Ivanova said she tried to withdraw the money in July, saying she needed it to send her daughter to college and to help buy a home, but she was told she could only get her money back at the end of the year, according to the court papers.

She was told on Dec, 1 by Frank Avellino and his wife, Nancy, that the money was lost, the court documents say.

"If that is correct information, it would be very interesting," said David Mark, a lawyer representing Victor Barnett of Palm Beach, Florida, who invested $10 million with Madoff.

MORE IS REVEALED AS THE WHISTLE BLOWS