Thursday, 29 September 2016
Last updated 1 hour ago
Oct 10 2011 | 2:04pm ET
The last piece of Bernard Madoff's business empire has closed its doors, almost three years after the con man's $65 billion Ponzi scheme collapsed, stunning Wall Street.
Surge Trading began winding down last month, little more than two years after it was created to acquire Madoff's market-making business, one of the legitimate business lines of Bernard L. Madoff Investment Securities. Surge, headed by former TD Waterhouse USA CEO Frank Petrilli, paid $1 million for the business—with revenue-based earn-outs that could have totaled $24.5 million.
But Surge, which operated one floor above the offices that housed Madoff's business before his arrest, was faced with huge costs. It had been seeking additional financing or a buyer, neither of which came to fruition.
It is unclear whether the trustee in the Madoff case will seek more money from Surge or its owners.
Surge directed clients to begin sending their orders elsewhere as of Aug. 31, writing in a letter to clients obtained by The Wall Street Journal:
"While there had been expressed interest in doing a deal, recent market volatility and a low interest-rate environment have not been especially helpful in getting a deal done."
Surge was set up in June 2009—the same month Madoff was sentenced to 150 years in prison.