Victims of Madoff's Fraud Blame SEC For Their Loss

   Victims of Madoff's fraud plan to return their huge- money-loss through court.

Photo: Victims of Madoff's Fraud Blame SEC For Their Loss

Victims of Madoff's Fraud Blame SEC For Their Loss

   Investors Phyllis Molchatsky, a disabled retiree, and Dr. Steven Schneider, filed the lawsuit Wednesday in federal court in Manhattan.

   Two investors who lost $2.4 million investing with failed financier Bernard Madoff have sued the U.S. Securities and Exchange Commission for their losses.

   The lawsuit said the SEC had "countless opportunities to stop the Ponzi scheme Madoff operated over 16 years, and botched all of them." The lawsuit said the SEC directly caused the investors to lose their investment.

  The SEC has faced criticism for not discovering the multibillion-dollar fraud since it was revealed last December, when Madoff was arrested. He is serving a 150-year prison sentence after pleading guilty.

  SEC spokesman John Heine said Wednesday the SEC believes there is no merit to the complaint, according to the Associated Press' report.