They had known him for years as a golf partner, a family friend. Some were neighbors or fellow members of country clubs on Long Island and in Florida. Many had begun investing with 70-year-old Bernard L. Madoff decades ago, often after being referred by a friend or relative who had known the Wall Street veteran even longer. There had been some warnings: Financial consultants had been suspicious for years about his astounding run of success. They couldn't figure out how he managed to produce steady returns, month after month, even when everyone else was losing money - and leave almost no footprint while moving billions of dollars in and out of the markets. "People would come to me with their statements and I couldn't make heads or tails of them," said Charles Gradante, co-founder of the Hennessee Group and adviser to hedge fund investors. "He only had five down months since 1996," Gradante said. "There's no strategy in the world that can generate that kind of performance. But when people would come to him and say, 'How did I make money this month?' he didn't like it. He would get upset with people who probed too much." Those investors were scrambling Friday to learn whether they had been wiped out by what prosecutors described as a multibillion-dollar Ponzi scheme, in which money provided by new investors is used to pay seeming high returns to early stage investors. The scheme collapses when required redemptions exceed new investments. The assets of Madoff's investment company were frozen Friday in a deal with federal regulators and a receiver was appointed to manage the firm's financial affairs. Madoff estimates he lost as much as $50 billion over many years. The roster of alleged victims included Sterling Equities, co-founded by New York Mets owner Fred Wilpon, as well as a long list of Madoff's friends, neighbors and country club associates - many of them from prominent Jewish families in New York and Florida. Joyce Greenberg, a philanthropist and retired financial adviser in Texas, said her family began investing money with Madoff in the 1970s after being introduced by a stepbrother who knew him from college. She stuck with him after her husband, the Houston entrepreneur Jacob Greenberg, died in 1987, partly because Madoff had been with them for so long, but mostly because he kept posting profits. Like other investors, she said she never questioned his strategy. "I hate computers, and I never tried to figure out what he was doing because the bookkeeping all added up," Greenberg said. She said she was still trying to figure out Friday how much of her money was gone. Investor Lawrence Velvel, dean of the Massachusetts School of Law, said he was introduced to Madoff by a friend whose late mother began investing with him decades ago. She was impressed by the fancy cars of friends who had made a fortune with him, Velvel said. He described a powerful word-of-mouth allure, with one friend after another recommending Madoff as a sure thing, someone who took on new clients only reluctantly and as a favor. "I was told there was a small number of people who practically begged him to let them keep their money with him," Velvel said. "Older people living off their savings. These kinds of people and others practically begged him." Brad Friedman, an attorney representing several people who had invested at least $1 million with Madoff, said most had been with him for decades as well. "They know him socially, through the Palm Beach Country Club or the Glen Oaks Country Club [on Long Island, east of New York City]. They played golf with him," Friedman said. Sterling Equities released a statement Friday expressing shock at the turn of events. "Like all investors, we will continue to monitor the situation," it said. The firm did not disclose how much it had invested. Other funds that announced investments in Bernard L. Madoff Investment Securities LLC included Fairfield Greenwich Group, Bramdean Alternatives Limited and Pioneer Alternative Investments. Fairfield said it had $7.5b. in investments linked to Madoff, about half its total $14.1b. under management. "We have worked with Madoff for nearly 20 years," said Fairfield Greenwich founding partner Jeffrey Tucker. "We had no indication that we and many other firms and private investors were the victims of such a highly sophisticated, massive, fraudulent scheme." A private Swiss bank that merged with the Fairfield Greenwich Group in September said it has 56m. Swiss francs ($47.5m.) of client assets invested under Madoff's management. The Geneva-based bank, now named Banque Benedict Hentsch Fairfield Partners SA, said in a statement posted on its Web site Saturday that its exposure was less than 5 percent of the wealth it is managing. Madoff's arrest prompted a letter from J. Ezra Merkin, the chairman of GMAC Financial Services, to investors in Ascot Partners LP, a hedge fund managed by his Gabriel Capital Group. The letter revealed that "substantially all" of Ascot's assets had been invested with Madoff. "I am shocked, as I know you are, by this fraud. As one of the largest investors in our fund, I have also suffered major losses from this catastrophe," the letter said. Merkin had served with Madoff on Yeshiva University's board of trustees. And yet there had been warning bells for years about Madoff's company. Jake Walthour, a principal at the hedge fund consulting firm Aksia LLC, said his firm was hired to investigate Madoff's business dealings by a potential investor several years ago. The probe raised several red flags, he said. Madoff's returns were "abnormally smooth" from month to month and had none of the volatility usually associated with stock investments. It seemed impossible to replicate his investment strategy or verify his track record. Madoff claimed to be moving as much as $13b. in and out of the market every month but "no one on the street could verify it or even see his footprints," Walthour said. "That organization was incredibly secretive." He issued only simple paper reports to investors, not detailed electronic data streams that indicate how those investments are doing. There were few if any outsiders involved in his business. His auditor was a tiny accounting firm in Rockland County, north of New York City, that no one had ever heard of. "We decided there are several scenarios here, one of which is: This could be a Ponzi scheme," Walthour said. "None of our clients invested."