What did Mrs. Madoff know and when did she know it?
You might ask: who cares about Mrs. Madoff? After all, it’s her husband who’s the culprit.
There’s little doubt that this is true. But a rather intriguing article appeared in today’s NY Times on the subject of the involvement (or lack thereof) of Madoff’s wife Ruth in the whole scheme. It touches on a subject relevant to other spouses engaging in other acts of crime or major wrongdoing: is it possible to fool a wife or husband about so basic a character trait?
There are people quoted in the article who say Ruth Madoff must have known; a wife would know and a wife should know. There are people who say the same thing about child molesters, serial killers, adulterers, and most of the other varieties of human wrongdoing. But it is my observation that, although it is sometimes true that wrongdoers leave a clear trail and that any spouse who doesn’t intuit what’s going on is in a state of denial, sometimes the culprits are so slick and so clever, so good at dissembling, that no one would ever know.
To think otherwise is a self-protective lie we tell ourselves to reassure ourselves that we could not be taken in this way; oh no, surely not! But the evidence points to the fact that Bernard Madoff was a master at taking people in, gaining their trust, and then politely screwing them. He fooled people who would otherwise have been wary. His reputation was spotless, stellar, and lengthy.
And his wife, apparently, was part of his game, if only unwittingly. He used her charm and friendliness to woo new investors without seeming to be in need of them. The feeling people got was that they were lucky that Madoff deigned to take their money; he was doing them a favor, not the other way around.
Here’s the Times on the subject:
Was Mrs. Madoff really blindsided? In the social circles where the couple once traveled, both possibilities are unnerving ”” that Ruth Madoff was in on this, or that she wasn’t…Either way, wittingly or not, she was an essential asset to her husband, humanizing him and drawing people into his orbit.
I’m not saying that Mrs. Madoff absolutely did not know what was what with her husband and his deals. But the article points out that she would have almost had to be a skilled accountant, devoted to studying his books, to have learned the truth of what was going on. Assuming she did not do that—and why would she have, even if she had the training?—the only other clue to the existence of the Ponzi scheme would have been her husband’s suspicious demeanor. And my guess is that, until shortly before that fateful December 10, 2008, when he claims he first spilled the beans to his wife and sons, he managed to exude the same gravitas, confidence, and reliability as ever.
It’s tempting for us all to think that we would not have been fooled had we been in Ruth Madoff’s position. But I say, isn’t it pretty to think so?
His sons, who were much closer to the business by all accounts, seem not to have known until he told them to turn him in. If it were otherwise, it might appear more like “Arrested Development,” but we may have to forgo that schadenfreude in the interests of the truth in this instance.
To lop off 2 heads is always better than one but I want to believe she was not complicit. Many secrets are kept in a marriage and it seem logical to think spousey would keep mum on his crookedness.
If he could so thoroughly flim-flam the rich and famous, even those in the financial district, why couldn’t he have kept his wife in the dark.
My wife is of the opinion that this Ponzi scheme was a family deal and that—since Madoff hired mostly family to run his business operations–close family members all knew about the scheme–which, after all, ran for 40 years–and participated in the Ponzi scheme in one way or another.
Thus, Madoff’s “confession” to his sons, who were his chief managers and, apparently, ran the trading and back office operations, and their horrified calls to police to turn their father in, were all just theater, designed to spotlight Madoff himself as the sole culprit, and designed to allow the rest of his family to perhaps escape closer scrutiny and exposure. Likewise, the discovery of the $173 million dollars in already filled out and signed checks, and the $1 million in jewelry Madoff sent to relatives, that they reported to the police, were red herrings–comparative chump change–designed to preoccupy cops, and hopefully make it less likely that they would dig more widely and deeply for evidence of much more significant billions of dollars stashed away here and there.
We can all be fooled. I knew a woman whose husband disappeared one day leaving her with $100,000 in gambling debts. So it goes.
It touches on a subject relevant to other spouses engaging in other acts of crime or major wrongdoing: is it possible to fool a wife or husband about so basic a character trait?
to me asking the question is a bit daft… with ALL the evidence around you, how can the question be asked? i am not trying to be snarky, just i am really amazed (if you were not so smart, i wouldnt be amazed – left handed compliment but true – such feelings are often contextual).
where to start… biology, evolution, psychology, criminology… sigh.
lets start with biology.. we are all not perfectly rational because perfectly rational people are perfectly predictable, and so are easy to control. ergo, we are not perfectly rational.
if we could read people perfectly, that would be akin to being perfectly rational, and so perfectly predictable. perfectly predictable people are easy to control
from evolutionary points these are dead ends or ends that lead to parisitism and or symbiosis…
parents are smarter, know more, and can more easily model a childs more predictable mind (not perfectly), and so the child is the sumbiont of the parent.
women pick men to be competent at exceeding their own capacity to support themselves and so can provide for another. they are socially smarter, but competently less because men do not select them for competence (at least not in the same categories). anture insures that the dimorphism is not so much for us that we overlap and can cover each other. this creates the cooperative symbiosis of the family… however, none are predictable to the point were balance is lost (otehr than if you take a false perspective).
so ultimately, there are a lot of reasons for the imperfection of knowing others minds, reading them and so forth.
studies show that most of us cant detect lying. we cant detect those trying to manipulate us, or we detect manipualtion where there isnt any. we reason by other means to ends, since using our sense of mind when directed at us is not a good way. which is what we do when assessing socalist attempts and why we dont call them to the mat for things.
examples… since there isnt enough space for true empiricsism, i will use extreme examples to connote that maddoffs situation was an easy gig.
one thing to note, its VERY common for women to marry men or be with them, and in exchage for a good life not ask questions.
my uncle was wealthy during the height of the depression, his wife never knew how he made his money… she didnt want to know… she DID drive him to suicide nagging him much like in the silent film greed, which turned her into a notorious cat woman in brooklyn (so i gess he got her… he loved the radio. each night he would come in to lsiten to it. like the dentist in greed would be with his bird. she would nag nag nag. one day, he turned the radio off. went downstairs, and never came up).
anyway… she willingly doesnt know… then you have john gotties wife. in the middle, she knows her husband isnt good, but doesnt know the details and its allright with her. after all, they live better while alive than not, and if your secular, why is it wrong? to quote an honest woman onlne about mating. she wanted ” a guy that was ok to me and my kids but was the meanest son of a bitch againse every one else”
the woman may have the whore maddona complex, and bitch about it. but its sure easier to role play the two, than it is to live the deadly gentle thing… thats why men can murder all day, and come home to the wife and kids. they selected them for that.
anyway… to the extremity of lies.
for my first entry, i say look to a man by the name of richard kuklinksi. (his brother was a pip too).
he was a family man. he was also and is also one of the coldest mob assasins who had ever been caught. if not for a few mistakes, he would never been caught, and he is an example of a subclinical sociopath/psychopath.
when asked as to what was his worst kill. he said only one bothered him. the man begged for his life, he asked god to save him. kuklinski said that he told the man, ok. that he would wait an hour for god to save him, and if not, then he would die. god never saved him, and kuklinsky said it bothered him (though i never heard why)
you can see him here.
video.google.com/videoplay?docid=5740692213665972395&ei=yI1vSfLONIP6-QHsifC3BQ&q=iceman&hl=en
he was a family man with kids. his wife and children never knew what he did. he would get a call, he would leave, and then come back later. end of story, she never asked. just like the aunt with my uncle, who none of us to this day know what he did (we do not asume it was the same thing, we dont have any idea. it could have been liquore, or ligit, people were more private then).
then there was the green river killer, the book on that one is “biography of an unsuspecting wife”.
of course its not just death.. governor who just lost his family and such by telling his wife he was gay? (thats more complex though, hard to tell someone somehting if you havent yet come to terms with it either. or you come to terms with it by accepting that if they tell you thats what you are beacuse you feel x, then you have to be that, when the truth is you can feel x, fantasize Y and not be)
Gays were often targets of spy networks. this is less true today, but in the past, you got a person who was already capable of living a dual life
how many gays are there? i think they lie and hide it quite well, no?
is that enough evidence yet? (and why i might think that its amazing to ask?)
ok… how about lattimore… lattimore wrote a book about how mccarthy smeared him as a spy… he coined the word mccarthyism… turned out he was a spy… oops.
then there was harry dexter white… he beacme the head of the federal reserve… maybe thats why we are aching… hard to talk about he feds problems and be honest and compelete without noting the russians games in our own financial systems (eh lee?)
ethel rosenberg… did she know what her husband was doing? like the presumption,she shared his fate yet we assumed it (later we knew she did, but technically when she was killed they didnt).
how about one of my favorites? she wa a german spy, with a indonesian appelation.
Mata Hari: listverse.com/wp-content/uploads/2007/08/spy-mata-harimed.jpg.jpg
Margaretha Geertruida (Grietje) Zelle / divorced her husband was a prostitute, got in good with the tops, and was a honey pot for germany
then how about one of the most successful in near modern times? Aldrich Ames. he was married too, but i think his wife knew (husband testified so). she begged for mercy and the judge let her off.
Giacomo Casanova
a spy, and a womanizer… did the women know? 🙂 basically his power came from the secrets he learned from the women he went to bed whith who cheated on their men. (so the bible is not so far off on how bad this can be, eh? for the womens families suffered, and received no gain).
Klaus Fuchs – he was one of those already living a double life.
Belle Boyd is an interesting character (of course doing things when women supposedly were slaves – there are lots in history like this, but since feminism/communism didnt make them happen, they are suppressed).
Her career in espionage had a rather startling begining: when a group of Union soldiers broke in to her parents home with the intention of raising the US flag, one of them insulted Belle’s mother. Belle pulled out a pistol and shot one of them. She was 17 years old. A board of inquiry acquitted her but she was placed under surveillance. She profited from this by charming military secrets out of at least one of the Union sentries guarding her. She later wrote of him:
“To him, I am indebted for some very remarkable effusions, some withered flowers, and a great deal of important information.”
the whole nature of women is to dissumulate and manipulate to acheive ends… they do in the shadows what men do in the open… dont believe me? read about neros mom, or churchills… heck read bout the motehr of the marx brothers. all working through others. even feminists work through the men in state.
Richard Sorge a famous kgb spy in japan… he too was selected becayuse he already led a double life.
Sorge was arrested on October 18, 1941 in Tokyo, in the house of his lover after a policeman picked up a note that he threw on to the road instead of destroying, warning him that he was being watched. Even under torture, he denied all ties with the Soviets. Sorge was not exchanged for Japanese prisoners of war, because the Soviet government as well as Sorge himself denied that he was spying for USSR. He was hanged on November 7, 1944, 10:20 a.m. Tokyo time. The Soviet Union denied all knowledge of him until 1964.
so much for making sure the history you know includes all the history.
no… the hsitory of man is completely full of the fact that men and women can lie to each other to acheive ends.
from tavistok, cia, kgb, etc… to the mobs, triads, tong, yakusa, posses, etc… to the guy or gal cheating on their cuckolded wife or husband.
30% of all births the father doestn know that the child is not his!!!!!!!! this is why the feminsits pushed no fault divorce, and that it doestn matter and such…and hwy he has to pay even if he didnt know… otherwise, they would be responsible for this, and he would not be. so they insttutionalize kuckolding and the results? murder suicides, and more… while we presume 100% fidelity… heck if ya got to be someone elses slave for your life, what matters what you do? (guys are made to die trying, women are made to give up before dying, generally, specific miles may vary – though for every woman on a police force civilian shootings go up!).
when we talk history or current events, we are so gullible we just omit that lies happen.
look at obama election? those that could tell he was lying (158 of em), no on could tell others that he was! so not only can we be lied to, and not know it, we can be snown it and not belive it.
madoff is a sociopath… and he may be working for some side… (may, lee, may…).. we may never know… but if bella dodd can put 1000 operatives into the catholic church wtihout them knowing, nd refusing to believe to today, madoff could also have been touched. if so, i think thats why he is not upset… he did what his mision called for.
and his mission called for the ruination of the people who may put their own money into oppposing the change and to fund the cause.
what will be the result when we find that most of the money didnt go to freinds and family but to politicval ends. would that make it even more possible?
ah… no one will know except madoff.. and he wont tell… not for a long while. maybe we may see his name in the book of heroes one day… maybe next to obama, clinton, etc. there is a book and in that book the truth is recorded, so that after the revolution, those who are thought to be traitors and such will be revealed as not.
like House says… “everybody lies”
[but house went from an aspergers kind of guy to a sadistic sociopath, so i stopped watching]
everyone is assuming greed… why cant it be something else?
If the SEC had difficulties understanding Madoff’s scheme, I doubt his wife stood a chance.
Unless she’s a forensic account by trade?
forensic accountant that is…
A Russian & accomplices Arrested for Robbing Wealthy Americans
http://www.spamfighter.com/News-8987-A-Russian-accomplices-Arrested-for-Robbing-Wealthy-Americans.htm
Undercover investigators arrested 24-year old Igor Klopov, a Russian national, and four others on charges of trying to rob $7 Million off a millionaire in Texas who is also a political supporter of President Bush and is named Sam Wyly Jr. There is also accusation on all the five of committing theft of $1.5 Million from some more rich Americans.
Klopov allegedly carried out his plan from his Moscow home and employed co-conspirators from Websites such as CareerBuilder.com and Monster.com. He also paid private investigators to furnish more information about his target victims.
nigeria, russia, and islamic countries all have peopel targeting the wealthy to steal for their causes. i just listed tons of people who wer enot what they seemed to be.
Investigators lured Klopov to leave Russia and come to New York where he was handcuffed on May 2007. Four more people involved in the scam were also arrested on August 16, 2007 in Michigan, Texas, Kentucky and Florida, according to the authorities.
we may not find any money… as it may have been funding things aroudn the world. and the whole thing was as good for as long as they could keep it going… with assistance of others in state whose help is so ambiguous they will remian there. and this would have given him the complete planning resources of the directorates.
to quote an article
It’s hard enough to legitimately manage $50 billion. To falsify books and hide that big a sum, though, experts suggest Bernard Madoff had help. But who??
“Speaking as a Jew on Christmas, I would be less shocked if Santa Claus showed up to my house than if Bernie Madoff pulled off this fraud alone,” says Ron Geffner
everyone always jumps to greed… greed makes us focus on one, say yeah yeah… and not realize that greed is only one reason in a panoply of others that have more weight at this level
what may be more telling is who was not a customer, or a customer that isnt complaing, etc.
The Two-Headed Bank
http://www.time.com/time/magazine/article/0,9171,941440,00.html
ROYAL Bank of Scotland has sold its stake in Bank of China without making a profit…
Lucky for china… but then again, they had just broken into the world bank and pentagon computers.
“I spent most of the first two quarters of 2008 marveling at the pace of Chinese reserve accumulation,” Council on Foreign Relations economist Brad Setser in New York wrote on his Web log this week. “I expect to spend the first few quarters of 2009 marveling at the size of the U.S. fiscal deficit.” Best Customer
China owns US$653 billion of Treasuries, and indications are that it’s losing its appetite for U.S. debt. Expect Asia’s second-biggest economy to cut the share of dollars in its US$1.9 trillion of reserves, and perhaps sharply.
The question is how aggressively China will shield itself from what increasingly looks like a sucker’s bet. Economists at Deutsche Bank AG in Frankfurt, for example, estimate China will trim the share of dollars to about 45 percent this year from more than 70 percent in 2003.
[of course no one here discussing finances even mentions that with this crap, china may financially bomb us in a way we will not think its purposeful]
News reported on October 10 that the World Bank suffered a series of cyber-attacks starting in the summer of 2007, both at headquarters and at other offices around the world.
Cyber hackers have broken into the computer system at the headquarters of the International Monetary Fund (IMF),
China denies hacking into Pentagon computers
http://www.telegraph.co.uk/news/worldnews/1562266/China-denies-hacking-into-Pentagon-computers.html
Officials claimed that part of the US defence computer system had to be shut for a week in June after the “cyber-attack”.
Chinese hackers ‘raid Whitehall computers’
http://www.telegraph.co.uk/news/uknews/1562201/Chinese-hackers-%27raid-Whitehall-computers%27.html
Chinese nuclear submarines prompt ‘new Cold War’ warning
http://www.telegraph.co.uk/news/newstopics/uselection2008/1920917/Chinese-nuclear-submarines-prompt-new-Cold-War-warning.html
all that and more has gon on in the last 6 months.
when there is a lot of noise… look to see what they are NOT reporting… for the noise is to distract you.
Satellite photographs passed to The Daily Telegraph this week showed that the secret base at Sanya on Hainan island will house up to 20 of the latest 094 Jin-class nuclear ballistic submarines that could be capable of firing anti-satellite missiles and nuclear-tipped cruise missiles.
Chinese defence expenditure is estimated by the Pentagon to be $50 billion (£25 billion) but analysts believe large chunks of the budget are “squirreled away” and it could be as high as $200 billion making it the second largest in the world after America.
madoff is not that important as news compared to these other things lining up…
Does it really make any difference? Those who lost their life savings won’t be a penny richer or poorer based on what the Madoff family knew or didn’t know.
After I read this quote,
“After nearly 50 years of marriage, they worked in the same Midtown Manhattan office, they traveled together, and they dined together night after night, just the two of them.”
I’m convinced. She knew about it.
A couple who has shared dinners, work, bed, toothpaste, bathroom, and bodily fluids, among other things for 50 years, will not keep something like a multi-billion-dollar Ponzi scheme a secret from one another. That is impossible to do. (Fifty years, people!)
I am not surprised if she was the smiley face and sweet demeanor behind the operation. I have seen Amway couples (and other MLM couples) pull the same thing over the years. We attended an Amway recruiting chat in the DC area years ago, and heard this one couple talk about their business and their wealthy lifestyles. But when the man’s blond-a-licious wife (I still remember her British accent and tanned looks) started talking about their travels, homes and leisure, I realized their game. And then, she said the one sentence that turned me off their scheme: “My life is a constant vacation!” After a few more minutes, my husband and I couldn’t walk away from that place fast enough.
I have no doubt in my mind that Ruth Madoff knew, and was involved in, all of it. I don’t know if prosecutors will investigate her as well, but they better start doing so right now. If she can sing like a bird, her husband (and probably their sons) are in bigger trouble than they know.
newton: I think you are naive about the ability of human beings to dissemble and deceive. Some can do it for their entire lives.
True, people can deceive in a spectacular manner, for a lifetime indeed.
But don’t tell me she didn’t know. She worked on his financial firm! She had to have some knowledge of his dealings, positive – or negative. She would have known of the “accounting firm” that was used for audits. She would have known of the office chatter and the inner workings of the firm. (There’s a lot that can be divulged by “pillow talk” sessions or a “sleep-talker” husband. I know.) Then, multiply it by forty years.
I don’t think she was an ignoramus.
But let’s give credit to the argument that “she didn’t know.” For a husband to hide something so deeply wrong from his wife (robbing clients cold in a Ponzi scheme, or an even worse example – raping and hiding their daughter – and her poor children – in a bunker for many years, among other things that deceitful husbands have done to wives) is a huge act of betrayal. How can she live with herself – and him – after finding out? Will she still “love her husband” after finding out he was a major-league thief?
People can indeed deceive those they love for a lifetime. But I really don’t think Ruth Madoff can be counted among the deceived. What kind of wife would continue life with a man who loved money more than anything else? Only someone who knows that the show must go on.
newton: excellent point. She may be in shock, and/or in denial. For now, anyway.
I find it very hard to believe the sons didn’t know. And if they knew, it is even harder to believe that their mother didn’t know.
We’ll see how hard they fight against being forced to disgorge the proceeds of fraud. That, too, may be an indicator of how deeply they were involved.
Who didn’t know what? We all know nada, zip about Madoff except one recent day after 20-30 successful years he announced his was a a Ponzi, so he was arrested. I am confident it was not always a Ponzi. I will await facts before engaging in what is at present pointless speculation. Innocent people have pled guilty to murder, too.
Let’s just stop all this gossipy stuff, whether or not the NYT also engages in it.
Just my 2 centavos.
I was taken in for about a decade and a half by a man to whom I was married. He managed to convince me that the problems were mostly in my head. That my instincts about something being fundamentally wrong were just paranoia.
Years later, after he had a come-to-Jesus experience, served a prison term, and after he’d cost me almost everything I cared about, he admitted that it was him all along. Was it even possible that I could have known? Maybe. Did I have reasons to be in denial, if indeed I was? Sure. Was he a manipulative, destructive, incredibly sick person? That was agreed by everyone, including him – after the fact.
I doubt he could have kept up his lies and deceit for decades. But he got away with it for fifteen years, at a huge cost to me and our children.
Now I don’t make too many assumptions about how someone else “must have known” or “should have known.” Be careful judging others, or you may find yourself someday the victim not only of a trickster, but with your own lack of sympathy and understanding turned on you by those whose help you might have counted on.
I started to write, and before I knew it, there was a whole long deal with many indications that much if not all of the family was involved, and the “turning in” of Bernie Madoff by his sons, was a well choreographed and planned performance. In fact, there are so many facts, it is virtually indisputable, as is the involvement of Mrs. Madoff. (One need not know accounting details to know that money from new investors is being used to cover obligations to previous investors!) Mrs. Madoff was there every day in her office, was “inseparable” from her husband, and the most generous thought that occurs to me is that she might have convinced herself that it was just the way things are done, and it always worked out — at least it had for 30 yrs!
The sons were not little boys, each worked for the company, at minimum, over a decade, and unless they operated from under a rock, they knew primarily what the deal was, if not the nitty gritty details.
Oh, by the way, on the very day that the brothers “turned Dad in,” one was served with divorce papers. Sounds like he was married to a real sweetheart, but aside from that, I don’t know where you all live, but generally divorce papers have to be prepared by an attorney, filed with the court, and then served. Could it have been an absolute coincidence that their world imploded on that very day? Sure. But I don’t buy it. She’s off to wherever, with her kids, her own jewelry, G-d knows how much in trusts, and valuables, and most probably a nice haul of cash, too.
I’m guessing the top employees also knew. They directed the flow of investments coming in, the various bank accounts moneys went into, came out of, and where it went, and someone had to compute billings and fees for the company and it’s divisions — no way Bernie sat all alone in his office and did this.
And just think of how long it takes to write 100 checks, sign them, put them in envelopes and address them. Generally more than a day’s work…..
I have a theory — which I’m finding many others agree with.
No way Bernie boy LOST $50 billion…or even $37 billion (no one yet knows actual nos.) I’m thinking he was successful and highly respected when he started his business some 30+ yrs. ago. I’m thinking he started out honest. But bear markets come and go, there are cycles — some more volatile than others. I think there came a time when Bernie was a little short, so he did a little lapping (accounting term for taking from new income to pay old debts — i.e. not using the income directly related to said debts. I think he found it surprisingly easy. So he did it again, …and again….and again. I think then it occurred to him he could skim a little more than those fat fees clients paid, and covered it up with this convenient method that worked so well. And so it went. Toys and houses got bigger and more expensive. I also think psychologically it becomes a “game” of sorts…cheating the odds, and the accompanying thrill. This is similar to the reason enormously wealthy people continue to work, and often risk fortunes, some lose them and make them back..
At any rate, I think there are bundles of money stowed in so many places it would make all our heads reel. Sure the expected Swiss accounts and/or Cayman Islands banks, but probably bundles of cash, too. I don’t know that they’ll ever be found. But I guarantee Mrs. Madoff is not going to live like “the little match girl.” By the way, all the homes: 4 of them, worth tens of millions of dollars, are all in HER name, not Bernie’s.
Shana Madoff, too, probably knew a lot more than she will ever admit. Her boyfriend since 2003, and ultimately, her husband, was a lawyer for the SEC’s compliance division. That’s convenient isn’t it.
There’s so much more that is known, and I would wager many times more which is not known, and very possibly, will never be known. The fact is, the law apparently entitles a suspect to bail (maybe I watch too much law-related TV, but I could swear I’ve seen judges remand to prison without bail……?), and conveniently, Madoff has lots of assets to pledge. He’s as comfortable as can be. Well, maybe the leg bracelet is a bit awkward. It could be years before he ever comes to trial — if he does. Apparently, prosecutors are trying to “make a deal” — that’s going to be tough — get him to talk about where money is, and still satisfy the general public, let alone victims. By the time they do, it’s likely it will involve a guarantee of residence at a white collar crime camp, and I’m sure, at his age, his doctors will come up with any no. of delicate conditions that require special treatment.
Neo, this is one of the few times we are in complete disagreement. To use your very own words, “I think you are naive about the ability of human beings to dissemble and deceive.” Women, as well as men, are equally capable, as are younger persons vs. their elders.
(In full disclosure, I will add that I and my family are victims of Mr. Madoff. I am also an ex-accountant, as is my father, and we are no dummies when it comes to business. Also, for readers’ edification, contrary to nearly all the information on Madoff that has headlined newspapers, been the lead topics on televised reports, etc., not all of Madoff’s clients were enormously wealthy. Many of us are what might be regarded as upper middle class, who have not taken on debt that we could not pay — whether credit cards or homes, lived within our means and paid our bills, and also saved assiduously and invested conservatively for security in later years. For example, my father lost several million dollars which came from some 65 years of hard work & savings, also the savings of my grandparents who each lived to almost 90 and worked starting with a vegetable stand, lost everything in the Depression, started over by moving to FL and selling tropical fruit and and packaged gift baskets to sent up North, and saved and invested carefully in stock and a small bit of real estate, and my mother’s savings from all her years of working (she died 10 yrs. ago.) He conservatively invested unremarkable amounts of money saved and left to him, and over 65 -70 yrs. accumulated enough to live very comfortably, but hardly opulently. He also was very generous regarding philanthropic causes, and was asked to be Chairman of the Board of the largest private hospital in South Florida (a voluntary and non-paying position) specifically because of his financial acumen. My point is, to those who assume that all Madoff’s clients were enormously wealthy and greedy persons who “got what they deserved,” or were foolish dupes, that is hardly the case. All of you should say to yourselves “but for the Grace of G-d…” it could have been any one of you.
One last thing — many victims are absolutely broke, as we are. We are forced to sell the homes we saved for most of our lives. Because of the timing of this revelation, in this rather bleak economy, we will be lucky to receive 50% – to 70% of the actual value of our homes. Which makes us double victims.
(Very different from those who might experience foreclosure because they purchased homes more expensive than they could afford, and were encouraged to do so by certain members of Congress who pressured banks to make unheard of concessions to high risk customers, and greedy mortgage brokers taking advantage of this situation.)
csimon,
I totally sympathize with you. If I could do something to help cushion your pain a little, I would; however, I have no power of my own. I know you and your family invested with that guy in good faith, and that you had no reason to doubt his intentions.
You are not alone in your situation, besides. Today, I read that even Kevin Bacon has to look for work, to make up for being scammed by Madoff.
I also read that Madoff himself has been seen in the courtroom with a bulletproof vest. Even the mega-thief himself is afraid for his own life: he knows what he has done, how many people are nowadays p***ed off at him, and that at least one investor who lost everything will take matters into his own hands.
Oh, csimon, BTW:
If you have been following the Palm Beach Post, you will probably know that several Latin American wealthy families also fell for the scam. I would not be surprised if someone from within those families hires some kind of a hit-man, or whatever, to make sure Madoff pays for his crimes, if our courts don’t do their jobs. Also, Spain is considering legal action against him. And also, Britain’s Man Group.
Any way he slices it, Madoff knows his goose is cooked… and burned crisp. He’s a wanted man in three continents. What a guy! No wonder he has to wear a bulletproof vest!
(I’m sorry for digressing, neo!)
A story from Reuters today (http://tinyurl.com/8w73vn) says that investigators can find no record of any trades by Madoff’s company, and the assumption is that all of the statements investors received over the decades were total fabrications. Also reported was the fact that comparisons of share prices in statements don’t jibe with actual prices of those shares on the days they were supposedly bought or sold.
The assumption is that since clients got such regular as clockwork, detailed statements, they were reassured their money was in good hands and doing well, so they never bothered to actually check on the details of the various trades listed.
If true, this certainly shoots all to Hell the theory that his sons, who ran the back office operation, knew nothing about the Ponzi scheme.
Nothing is going to be noticeably “wrong” until somebody complains about not getting his money.
The key to a Ponzi scheme is delaying that as long as possible.
Until then, the marks put their money in, and they get their money out with terrific returns. Who’s going to complain? And about what? And if they made money, are they marks?
So, unless there was a forensic investigation–based on what?–nothing would show up as “wrong” until the first complaint about no money.
The securities regulators are supposed to do occasional audits, but it appears in this case they took the word of an accountant too closely affiliated with Madoff. It was their screw up that kept this from coming to light until it later did.
So the wife sees money coming in, knows that people who get their money out are happy and grateful. She even helps get money in, sure that the folks will be happy and grateful as others are.
If Madoff hadn’t explained the thing to her, there would be no major hook to trigger curiosity.
“Bernie” walks around with this little smile on his face because he knows he has essentially gotten away with it. He and his whole clan have lived the high life off of other people’s money for forty some years, and it is very unlikely that he will serve a day in jail–there are always lots of compliant Doctors who–for a fee–will swear that jail will kill a man of his age and precarious health.
I am seeing less and less justification for treating white collar criminals, especially major league ones–whose crimes can devastate whole families and communities, help destabilize our economic system, and make life miserable for tens of thousands of people for many years to come or, perhaps, for the rest of their lives–and violent criminals in such different ways.
Bernie lives under “house arrest” in his $7 million dollar Penthouse, and knows that if he does any time at all–an unlikely prospect–he will do so in comparative luxury and little danger at some “hotel Fed,” as opposed to the conditions imposed on the average bank robber, drug dealer, murderer or rapist. Court imposed restitution is a joke, since a very small percentage, if any, of the funds such white collar criminals steal are ever recovered or paid back. A murderer kills one or a few people, Bernie destroys the lives of whole families and communities, takes their homes and their futures, and leaves them bereft in their old age.
I think that if Bernie were in some cold, roach-infested lockup right now, smelling the stench of vomit and Pinesol, his fellow inmates and fear, knowing that if he didn’t fully cooperate he was going to be thrown, after conviction, into the general inmate population–and in fear for his life every second and likely beaten, robbed and probably raped on a routine basis–he would be a lot more cooperative, and that little smile would be wiped off his face.
what bothers me most is when the fox smiles when caught in the hen house.
anyone want a totally irrational theory for a side bet that he is dying of cancer or something along those lines?
I have known masters at this cover game. which is why i have brought up the sociopaths and borderlines and others in many occaisions when the converstation tends to lock into everyone is normal and equal and the same, so huge potential meaningful points are not considered.
neo, i need your help on this one. i know you know the higher arts, and i am drawing a serious blank on a very famous musician (that i think died in the last decade). anyway… the musician lived the life of a man, but got married, and her wife didnt find out he was a she (no operation) till the day she dies and the wife finds out then.
its not billy tipton, and i cant remember the name.
and from here
http://www.msnbc.msn.com/id/6249749/
Of 13,000 people tested for the ability to detect deception, “we found 31, who we call wizards, who are usually able to tell whether the person is lying, whether the lie is about an opinion, how someone is feeling or about a theft,” she said
hows that for a inability to detect lying that has to be genetic…
she cautioned that even the best of them is not 100 percent accurate
so only 31 out of 13k could do it, and the best of those were not 100%..
what they didnt test was how well this group would do if the liar was a sociopath or zealously believed the lie.
this FACT, is why our culture used to have such elaborate means of knowing other than blind trust. why “being from a good family” was important, behaivior does follow genetic lines, especially way out of center behavior. (how man women or men have thought they married well, only to visit the family for the first time and find out that they got the best poser in the batch of lunatics?)
why REPUTATION counted a lot more than most anything else.
we cant tell liars… its why letters of recomendation… its often why licensing is sometimes a necesarry evil (often used to much).
O’Sullivan calls these microexpressions – changes that last less than a second – and the people best at catching liars are able to notice them.
artfldgr- thought about that a while ago (Bernie knowing he only has limited time left…but as far as I know, and we know people close to him, no such luck (oops! I’m superstitious — I feel bad saying that even knowing what this man has done to my family, and countless others).
And if he were to be dying, he would have been better off just going — not revealing anything… Apparently, most, if not all his big assets are in his wife’s name, so she’d be protected (at least he thought). She’s in no better position now (regarding suspicion, than if this had come out after his death)……. As for his sons, figure it’s the same thing. They all benefited and continued to benefit from his scam — were he to leave a letter admitting mea culpa, would anyone believe it post-death than now. Don’t think so.
But I did lay in one of the first bets that at sentencing time, if it ever gets to that, he’ll have doctors lined up w/ reasons why his delicate condition requires either very special conditions or merciful release….blah, blah, blah……
I don’t know if his ego had grown so big over the years, and making it through all the various cycles of boom and bust (remember, he made it thru the tech bubble — and at the time, everyone thought THAT was the worst) — perhaps he just believed he DESERVED to be where he was and nothing, or no one could take him down. At the rate things are going, and the fact he’s ensconced like a prince in his penthouse, I wonder who will have the last laugh…….
There’s tons of money, and I guaranty you $50 billion were not lost. He was not a hedge funder, he didn’t make the big bets — “the market” knows when someone makes a huge bet and loses big. He NEVER did. Do you realize how much he would have had to be losing every single month, month in, month out for, say just 20 years (for argument’s sake, give him first 10 yrs. as legit)??? He would have had to lose 200 million dollars PER month every month over the last 20 years to lose what he said was lost! There’s tons of money — and that’s the prosecutors’ problem! They know it, too — and they want him to talk. They figured if they could get him into jail, make him REALLY uncomfortable, maybe even feel a little threatened, he might talk. But the judges don’t want to put him there………..
artfldgr- thought about that a while ago (Bernie knowing he only has limited time left…but as far as I know, and we know people close to him, no such luck (oops! I’m superstitious — I feel bad saying that even knowing what this man has done to my family, and countless others).
And if he were to be dying, he would have been better off just going — not revealing anything… Apparently, most, if not all his big assets are in his wife’s name, so she’d be protected (at least he thought). She’s in no better position now (regarding suspicion, than if this had come out after his death)……. As for his sons, figure it’s the same thing. They all benefited and continued to benefit from his scam — were he to leave a letter admitting mea culpa, would anyone believe it post-death than now. Don’t think so.
But I did lay in one of the first bets that at sentencing time, if it ever gets to that, he’ll have doctors lined up w/ reasons why his delicate condition requires either very special conditions or merciful release….blah, blah, blah……
I don’t know if his ego had grown so big over the years, and making it through all the various cycles of boom and bust (remember, he made it thru the tech bubble — and at the time, everyone thought THAT was the worst) — perhaps he just believed he DESERVED to be where he was and nothing, or no one could take him down. At the rate things are going, and the fact he’s ensconced like a prince in his penthouse, I wonder who will have the last laugh…….
There’s tons of money, and I guaranty you $50 billion were not lost. He was not a hedge funder, he didn’t make the big bets — “the market” knows when someone makes a huge bet and loses big. He NEVER did. Do you realize how much he would have had to be losing every single month, month in, month out for, say just 20 years (for argument’s sake, give him first 10 yrs. as legit)??? He would have had to lose 200 million dollars PER month every month over the last 20 years to lose what he said was lost! There’s tons of money — and that’s the prosecutors’ problem! They know it, too — and they want him to talk. They figured if they could get him into jail, make him REALLY uncomfortable, maybe even feel a little threatened, he might talk. But the judges don’t want to put him there………..
Neo,
The same NYT article has a link to another article on Ruth Madoff and “her” cookbook, which states in two paragraphs,
She handled “the books” before. There’s no reason to think she didn’t know what her husband was doing!
Silly me! Here’s the article to which I was referencing.
I wonder if Bernie is being thought of by his mostly Jewish victims according to the Stalin exception.
Stalin was sick and two Jews were talking about it, and one Jew said that he knew that Jews were not supposed to wish for the death of anyone, but for Stalin, he’d make an exception.
The wife knew. The sons knew. The brother knew. They were all in on the act. No one can run a scam that big for so long without a lot of help. Having seen a set of monthly statements and the buy and sell contracts, its too well done for him to have done it without the help and full knowledge of his inner sanctum. The buys and sells if one looks at the prices are correct for the prices on the transaction dated. On paper it all looks legit.
No doubt he had a fairly successful legitimate formula that worked for a number of years especially during a bull market. When the market went south, the formula failed and like a gambler he doubled down on the next bet to make up for the previous losses. That is when the books began to get cooked and scam started. The problem for the wife, the ex-daughter in law and the rest of the gang is that the trustee is going sue them for all of the money they got as a fraudulent conveyance. Once these things start, its impossible to determine real gains from the frauds. Hence all distributions above capital contributions will by necessity be considered profiteering. Therefore depending on how far back the trustee goes, a lot of people are going to be facing lawsuits for their profiteering. What a nightmare that will be, banks, hedge funds, foundations, charities and people of more modest means who spent it on their kids college tuition and the like being hit for excess distributions.
I have no personal knowledge, but it would appear Madoff had angels in the right places for quite a while to make sure there was no attention being paid to him. Way too big not to be on the government’s radar. The SEC had complaints on him, yet gave him a clean bill of health. So much for regulation. He has to have had angels both in the regulatory agencies and in the political branches to have lasted this long and this big. Soon enough it will come out and being Wall Street which is nearly all democrats, no doubt some people in the new administration and the usual suspects in Congress will also be found with connections to Madoff. No doubt there will be some republicans involved as well. At that level they are truly bipartisan.
cubanbob–Even if, as is likely, Madoff had his protectors in Congress, I think they will all skate, unless, of course, they are Republicans, or Republicans who can be framed, in which case, the stake and the stacks of wood are already ready to go, and the MSM is, even now, bidding on exclusive broadcast rights for the public burning.
I am just totally amazed that the main culprits responsible for kicking off the financial meltdown now unfolding, the Community Reinvestment Act, proposed by Jimmy Carter and passed by a Democratic Congress, and, most recently, Rep. Barney Frank and Senator Chris Dodd, chairmen, respectively, of the Congressional Committees that had oversight over Freddie, Fannie and the mortgage market, have escaped blame–although the Congressmen and their Democratic allies have been caught on tape arguing that absolutely nothing was wrong with Fannie and Freddie, arguing for even more subprime loans, and seen accusing those Republicans and administration officials who wanted more oversight, more control and investigation of Freddie and Fannie and the subprime market of being “racists,” who were inventing problems where none existed as cover for their real agenda of denying deserving minorities their “piece of the American Dream.”
All on tape, yet not only have Frank, Dodd and the Democrats escaped responsibility and blame, they have also managed the trick of pinning the blame for this financial disaster on Bush and the Republicans–the very ones–the only ones–who tried, over and over, in the last several years, to rein in Freddie and Fannie and stop the disaster we are now experiencing.
It helps if many in your audience are “educated fools” churned out by today’s so-called “institutions of higher learning,” but, be that as it may, if Frank and Dodd can skate, anyone can skate.
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