Madoff admitted he had been defrauding thousands of clients since the early 1990s - operating a classic Ponzi scheme - using the money that new customers invested to pay those who wanted to withdraw funds.
VOA: standard.2009.03.12
The alleged Madoffscheme also hit several charities and other groups.
Regulators would rather put Madoff to rest than further investigate firms that not only facilitated the Madoffscheme but continue to this day to conceal it from investors.
Authorities were only alerted to the alleged Madoffscheme in December, and it could be years before the bankruptcy trustee liquidating Madoff's investment business determines what individual investors will recover, and hence, (as the IRS sees it) what their deductible losses are.