Is Bernie Madoff's Life in Danger?

Whatever cell he sits in, whatever corridor he walks though, and from whatever direction and whatever means, Bernard Madoff must live the rest of his life knowing that at any moment he may die.

If someone kills Bernard Madoff, it may be some job figuring out who it was. One suspect would be the Russian oligarch who six months ago tried to get his money out and when Bernie said no made threatening sounds. Or it may be the Columbia drug lords who invested a purported $300 million with the Ponzi schemer. They are not happy either.

There are Americans who in the audit-no-taxes era of Bush 2 ferried their money off to Swiss banks without paying taxes and decided why not take advantage of those 12 and 13% annual returns from good old Bernie. How could they be happy? In the Obama era when Uncle Sam will probably be carrying a big stick and using it against white collar malefactors, these investors may find that they have not only have lost all their money but then be criminally indicted. How cruel life is sometimes. And let's not forget the lawyer sitting in prison who tried to get his money out a few months ago. Madoff knew the man was going away for a long time and refused his request. That man doesn't have the heart of a killer but betrayal does strange things to people.

Palm Beach is at the emotional epicenter of this scandal and here the impact is staggering. On the evening the news broke there was a palatable emotional wrenching in Amici, a popular Italian restaurant, a block from my home. There were screams of disbelief as the news arrived cell phone by cell phone. That has given way to a more subdued mood including a virtual epidemic of despair that has sent people to doctors and psychiatrists in search of anti-depressants.

The sheer numbers of victims continues to grow, so much that you also have to assume that if you are wealthy and a member of the Palm Beach Country Club, you lost and you probably lost big. The worse of it are the bereft widows whose husbands on their death beds said, "Whatever you do, take our money and invest with Bernie." And now many of them have nothing except the prospect of living with their children or in modest efficiencies on little better than dole.

It is going to be many weeks before the sheer scope of the damage is clear. Some victims are running around hiring lawyers and planning to sue, but for most of them their prospects are probably limited. In the first place, the trustee who will seek out whatever money is left will have enormous expenses that likely will eat away most of whatever is found. Those who invested directly with Madoff are probably out of luck. Those who were put into Madoff Securities by their accountants, lawyers, and brokers may have cases, but those professionals are not of unlimited means.

Beyond those who have lost everything the most devastatingly sad part of this story are the charities. Their losses are so enormous because Jewish contributions to charity are so enormous. If Madoff had been a WASP gentleman cheating the Old Guard at the restricted Bath and Tennis Club in Palm Beach, charities would have suffered very little.

The most terrifying prospect for the charity is not that they will lose so much of their funding but that they will have to return what may be considered ill-gotten gains. That is rightfully causing a tizzy in the foundation world, though it is unlikely the government would follow through.

Many of Madoff's victims were part of an acquisitive community overly concerned with wealth and status. But something is happening now primarily in Palm Beach that will likely change the whole temper of this tale. Some of those who have suffered deeply are realizing that they must move beyond their own pain and try to come together and help others. Some of them are aiding those who lost everything. There are plans among some members of the Palm Beach Country Club to lobby Congress to help the charities that have suffered. There is a growing awareness that the answer is not to try to kill Madoff or to waste energy condemning a man who condemns himself, but to move beyond the devastation and to reassert what is best.

Comments

[HuffPoLover]

Speaking of getting away with a Ponzi scheme: http://www.worldlawdirect.com/forum/ymmss-sta-complaints/20372-author-stephen-c-rose-may-have-profited-30m-ponzi-scheme.html

[HuffPoLover]

Soeaking of Ponzi schemers, looks like you might have one among your bloggers. http://www.worldlawdirect.com/forum/ymmss-sta-complaints/20372-author-stephen-c-rose-may-have-profited-30m-ponzi-scheme.html

[Wood]

Now you want me to help those charities? They went with him. I didn't...

[bodo]

In or out of jail, some of Madoffs former friends have connections. Either way, they will get him sooner or later.

[ReasonIsMyReligion]

Use a gun, go to prison.
Use a pen, keep your penthouse.

F-ed up, I tell ya.

[chayefsky]

Madoff should be tried and convicted. His sentence should be this: only two sets of clothing for life; life in an efficiency apartment with no modern conveniences; unpaid work in a soup kitchen, preparing and serving food to the poor; no contact with former friends and colleagues. For a man who thinks he's a king, who treats others like objects, this is a fitting punishment.

[outnow]

Bernie worked with "funnels" who steered clients to him. There are fronts-end payoffs to investors who extol the "virtues" of the Ponzi scheme. The front-end "salting" goes to investors who give "testimonials. Salting refers to rich ore samples allegedly taken from the mine to attract investors. Then the impression is created that there is some "insider information" being used to make such impressive profits, even in bearish markets where other funds are not doing well. People who are "pillars of society" are used to promote the scheme, often unwittingly. "Just ask Judge Jones, he made so much per year." Also, the religious groups cross denominations and faiths where money is concerned. Safety is only an impression. Risk is not acknowledged. It is hard to cheat an investor who wants profits at the going rate considering the security of that investment.

[AntonRobb]

To hell with Bernie Madoff. How about we set him free in the streets of Medellin and let those old boys take care of dispensing justice to him?

[KillTheMessenger]

Do I have to care now?

[marignymitch]

Is it too late to award Madoff the presidential Medal of Freedom? You know Junior wants to do it.

[ReasonIsMyReligion]

They hate us for Bernie Madoff's freedom.

[philopatris]

Plus Bienes' partner in the accounting firm of Avellino & Bienes, which they took over from Madoff's father in law, Frank Avellino. Avellino was stealing Madoff money from his own housekeeper and told her so ten days before Madoff gave up,
http://clusterstock.alleyinsider.com/2009/1/how-did-avellinos-housekeeper-lose-her-money-10-days-before-madoffs-collapse
and has, like Bienes, all sorts of Florida entities to hide money in. See the blog comments there.

[justseekingtruth]

Mr. Leamer. Are you aware of the role of Michael Bienes in the Madoff fraud?
Michael Bienes, a well known Florida Catholic charity "philanthropist", has enriched himself by funneling money to Bernard Madoff for over 35 years. Bienes started out as an accountant working with Bernie's father in law back in the 60s and he has grown very, very wealthy by collecting investment funds and turning them over to Madoff's Ponzi scheme. There is evidence to suggest Bienes' relationship with Madoff never ceased after a 1992 SEC investigation in which he was sanctioned for selling unregistered securities which were funneled to Madoff and that he has merely moved his operations overseas to London where he continues to engage in criminal activity.

[Pantodon]

He may be more worried about drug lords from Colombia.

[Sundialsvc4]

I say again, and I say quite sincerely: let him off, and bail him out. Then, give him a position in the US Treasury.

No, I am not kidding. Hear me out.

"Billions of dollars" mean nothing: the US Government borrows-from-itself more than $1 billion a day right now. "Money," therefore, is something that is invented by the government and doled out into the economy. So be it. Let it continue.

If those people don't get their money, jobs are lost because businesses close. The "ripple effect" of that will quickly exceed the value of the money that Bernie allegedly stole. And as I said, what is "money" anyway? "Money" doesn't cost the government any money at all.

Therefore, the Federal Government should guarantee all of the investments in Bernie's scheme and by any other Ponzi operator. Money really does grow on trees now.

[BBackSoon]

Steal a TV go to jail, Steal a sky scraper be congratulated on your boldness and thought of as resourceful?

So an historically large con-game is "too big to fail"?

It s#cks to be a little fish.

[strangerinthenight]

That $50 billion is already in Israel. Madoff and his investors know they will be reimbursed by our government. It's a scam.

[jstowe100]

"There are plans among some members of the Palm Beach Country Club to lobby Congress to help the charities that have suffered. "

Great - get the middle-class taxpayers to foot yet another bill.