SEC Charges Firm, 4 People With Fraud

Federal regulators have charged a brokerage firm called Cohmad Securities and four people with securities fraud, accusing them of funneling billions of dollars from investors into Bernard Madoff's pyramid scheme.

The Securities and Exchange Commission announced the civil fraud charges on Monday against Cohmad, its chairman, Maurice Cohn, chief operating officer Marcia Cohn and broker Robert Jaffe. Also named in the SEC's lawsuit was California-based investment adviser Stanley Chais, who allegedly oversaw three funds that invested all of their assets - nearly $1 billion - with Madoff.

Madoff secretly controlled New York-based Cohmad and used it to procure a constant stream of funds for his multibillion-dollar fraud scheme, the SEC said.