More likely, his firm devolved into a Ponzi scheme only when serious losses hit and he decided not to level with investors but to gamble on a resurrection.
Emerging from the world of penny stock operators, the company survived a cast of dubious financiers during the late eighties and early nineties: a Genovese crime family-associated broker, a Ponzi schemer and a stock swindler, whose firm inspired the movie Boiler Room, none of whose wrongdoings was related to BioReference or Grodman.
In March 2009, Bernard Madoff plead guilty to 11 federal felonies including running one of the largest Ponzi schemes in U.S. history through his investment firm.