EXCERPT: 'The Madoff Chronicles' by Brian Ross

ABC News chief investigative correspondent Brian Ross' new book, "The Madoff Chronicles," provides an in-depth look at the lifestyle of Bernie and Ruth Madoff. The chapter excerpt below provides a detailed account of the incidents leading up to and following the arrest of Madoff on allegations of swindling $50 billion out of investors.

After reading the chapter below, head to the "GMA" Library to find more good reads.

Chapter One: The Arrest

"Ike, it's Bernie."

The voice on the phone betrayed Bernard Madoff's Queens upbringing but sounded surprisingly young for a seventy-year-old man. And surprisingly calm, given the circumstances.

"I'm in the FBI office and I'm handcuffed to a chair," Madoff told his lawyer as he broke the news of his arrest for what would soon emerge as the biggest fraud scheme in Wall Street history.

Ira Lee Sorkin, a white-haired, veteran New York trial lawyer known as Ike, was visiting his grand-daughter's nursery school in suburban Washington, D.C., when his cell phone rang. It was the afternoon of December 11.

A former prosecutor in the United States Attorney's office in Manhattan and onetime head of the New York office of the Securities and Exchange Commission (SEC), Sorkin is one of the city's premier criminal defense lawyers. He is as aggressive as they come and not easily caught off guard, but Madoff's call stunned him.

Madoff had called Sorkin ten days earlier and asked to meet with him about a "problem." According to Sorkin, they had been scheduled to meet on Wednesday, December 10, but Madoff canceled the meeting, pushing it back to December 15.

Instead of a day of legal strategy with his defense lawyer, Madoff had decided to set in motion a plan that would involve him confessing to his two sons, Mark and Andrew, and then letting them "do the right thing" and turn him in to the FBI.

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He had asked his sons to give him a week to prepare, but events had moved much more quickly than he had planned. Two agents arrived at his Manhattan penthouse apartment at 133 E. 64th Street just before 8:30 a.m.—only twelve hours or so after his sons gave statements to federal prosecutors. Madoff, a meticulous, elegant dresser, was still in his pajamas, bathrobe, and slippers when special agents Ted Cacioppi and B. J. Kang of the FBI stepped off the elevator into apartment 12-A. They sat in his decorator-designed living room, and Cacioppi asked him if there was "an innocent explanation" for what his sons had described.

"No," said Madoff, who then calmly described what he called a "fifty-billion-dollar fraud" that he said he had carried out by himself, with no help from anyone else. The agents told Madoff to get dressed, put him in handcuffs, and took him downtown to FBI headquarters at 26 Federal Plaza, where he was allowed to call his lawyer.

"Bernie, don't say another thing," Sorkin whispered to Madoff on the cell phone, trying not to disrupt the three-year-olds in the nursery school class, and unaware that his client, with no lawyer present, had already made a lengthy—if only partially truthful—confession to the FBI.

From Sorkin's point of view, this was a legal disaster. He would never have advised Madoff to turn himself in and offer up a confession.

"If you have a client who robbed a bank, and there are video surveillance cameras and nine eyewit-nesses, it might be a good idea to have your client turn himself in," Sorkin said. That was not the case with Madoff.

His monumental stock fraud had been carried out in great secrecy. Among the thousands of Madoff's victims were prominent New York financial figures, a number of Hollywood celebrities, some of the coun-try's leading Jewish charities, and thousands of elderly retirees who had put their life savings in Madoff's hands because of his seemingly long and perfect track record of success. In some circles, he was called the "Jewish Warren Buffett."

It would turn out to be the biggest financial crime in the history of Wall Street, far eclipsing the 1980s insider-trading scandals involving junk-bond financiers Michael Milken and Ivan Boesky. They were small-time operators compared to Madoff.

At the time of his arrest, Madoff's thousands of investors believed they had a total of $64.8 billion in accounts with him, even more than he had estimated to his lawyers and the FBI. The clients received monthly statements showing a series of trades in blue-chip stocks, and a reliable 12- to 20-percent rate of return, year after year, even in rough markets when everyone else was losing money.