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Bernard Lawrence Madoff ( ; April 29, 1938April 14, 2021) was an American fraudster and
financier An investor is a person who allocates financial capital with the expectation of a future return (profit) or to gain an advantage (interest). Through this allocated capital most of the time the investor purchases some species of property. Typ ...
who was the admitted mastermind of the largest
Ponzi scheme A Ponzi scheme (, ) is a form of fraud that lures investors and pays profits to earlier investors with funds from more recent investors. Named after Italian businessman Charles Ponzi, the scheme leads victims to believe that profits are comi ...
in history, worth about $64.8 billion. He was at one time chairman of the NASDAQ stock exchange. He advanced the proliferation of
electronic trading platform In finance, an electronic trading platform also known as an online trading platform, is a computer software program that can be used to place orders for financial products over a network with a financial intermediary. Various financial products c ...
s and the concept of
payment for order flow Payment for order flow (PFOF) is the compensation that a stockbroker receives from a market maker in exchange for the broker routing its clients' trades to that market maker. It is a controversial practice that has been called a " kickback" by its ...
, which has been described as a "legal kickback." Madoff founded a penny stock
brokerage A broker is a person or firm who arranges transactions between a buyer and a seller for a commission when the deal is executed. A broker who also acts as a seller or as a buyer becomes a principal party to the deal. Neither role should be conf ...
in 1960, which eventually grew into Bernard L. Madoff Investment Securities. He served as the company's
chairman The chairperson, also chairman, chairwoman or chair, is the presiding officer of an organized group such as a board, committee, or deliberative assembly. The person holding the office, who is typically elected or appointed by members of the gro ...
until his arrest on December 11, 2008. That year, the firm was the 6th-largest
market maker A market maker or liquidity provider is a company or an individual that quotes both a buy and a sell price in a tradable asset held in inventory, hoping to make a profit on the '' bid–ask spread'', or ''turn.'' The benefit to the firm is that i ...
in
S&P 500 The Standard and Poor's 500, or simply the S&P 500, is a stock market index tracking the stock performance of 500 large companies listed on stock exchanges in the United States. It is one of the most commonly followed equity indices. As of ...
stocks. At the firm, he employed his brother
Peter Madoff Participants in the Madoff investment scandal included employees of Bernard Madoff's investment firm with specific knowledge of the Ponzi scheme, a three-person accounting firm that assembled his reports, and a network of feeder funds that inves ...
as senior managing director and chief compliance officer, Peter's daughter
Shana Madoff Shana Diane Madoff ( ; born December 8, 1967), sometimes referred to as Shana Madoff Skoller Swanson, is an American former attorney who is now a yoga teacher. She is the daughter of Peter Madoff, and a niece of Bernie Madoff, who employed her ...
as the firm's rules and compliance officer and attorney, and his now deceased sons
Mark Madoff Mark David Madoff ( ; March 11, 1964 – December 11, 2010) was an American financier, best known for his role in exposing the multi-billion dollar Ponzi scheme committed by his father, Bernie Madoff. Personal life Madoff was born and raised ...
and
Andrew Madoff Andrew Madoff ( ; April 8, 1966 – September 3, 2014) was an American financier, best known for his role in exposing the financial crimes of his father, Bernie Madoff, whose Ponzi scheme has been widely described as the most successful in history ...
. Peter was sentenced to 10 years in prison in 2012, and Mark hanged himself in 2010, exactly two years after his father's arrest. Andrew died of lymphoma on September 3, 2014. On December 10, 2008, Madoff's sons Mark and Andrew told authorities that their father had confessed to them that the
asset management Asset management is a systematic approach to the governance and realization of value from the things that a group or entity is responsible for, over their whole life cycles. It may apply both to tangible assets (physical objects such as buildings ...
unit of his firm was a massive Ponzi scheme, and quoted him as saying that it was "one big lie". The following day, agents from the Federal Bureau of Investigation arrested Madoff and charged him with one count of
securities fraud Securities fraud, also known as stock fraud and investment fraud, is a deceptive practice in the stock or commodities markets that induces investors to make purchase or sale decisions on the basis of false information, frequently resulting in lo ...
. The U.S. Securities and Exchange Commission (SEC) had previously conducted multiple investigations into his business practices but had not uncovered the massive fraud. On March 12, 2009, Madoff pleaded guilty to 11 federal felonies and admitted to turning his wealth management business into a massive Ponzi scheme. The Madoff investment scandal defrauded thousands of investors of billions of dollars. Madoff said that he began the Ponzi scheme in the early 1990s, but an ex-trader admitted in court to faking records for Madoff since the early 1970s. Those charged with recovering the missing money believe that the investment operation may never have been legitimate. The amount missing from client accounts was almost $65 billion, including fabricated gains. The
Securities Investor Protection Corporation The Securities Investor Protection Corporation (SIPC ) is a federally mandated, non-profit, member-funded, United States corporation created under the Securities Investor Protection Act (SIPA) of 1970 that mandates membership of most US-register ...
(SIPC) trustee estimated actual losses to investors of $18 billion, of which $14.418 billion has been recovered and returned, while the search for additional funds continues. On June 29, 2009, Madoff was sentenced to 150 years in prison, the maximum sentence allowed. On April 14, 2021, he died at the
Federal Medical Center, Butner The Federal Medical Center, Butner (FMC Butner) is a United States federal prison in North Carolina for male inmates of all security levels who have special health needs. It is part of the Butner Federal Correctional Complex and is operated by th ...
, in North Carolina, from
chronic kidney disease Chronic kidney disease (CKD) is a type of kidney disease in which a gradual loss of kidney function occurs over a period of months to years. Initially generally no symptoms are seen, but later symptoms may include leg swelling, feeling tired, vom ...
.


Early life

Madoff was born on April 29, 1938, in Queens, New York City, to Sylvia (Muntner) and Ralph Madoff, who was a
plumber A plumber is a tradesperson who specializes in installing and maintaining systems used for potable (drinking) water, and for sewage and drainage in plumbing systems.
and
stockbroker A stockbroker is a regulated broker, broker-dealer, or registered investment adviser (in the United States) who may provide financial advisory and investment management services and execute transactions such as the purchase or sale of stocks and ...
. His family was Jewish. Madoff's grandparents were emigrants from Poland, Romania, and Austria. He was the second of three children; his siblings are Sondra Weiner and Peter Madoff. "Ruth, who grew up in Laurelton, Queens, with Bernie became his steady at Far Rockaway High School. She had attributes that intrigued Bernie: She had a 'shiksa' look, but was Jewish; she was social and outgoing; she had a shrewd accountant father, and she was a whiz at one particular subject – math – all the right stuff for a future Master of the Universe in the gilded canyons of Wall Street. Married in 1959, Bernie would later cheat on her like he cheated his clients." Madoff graduated from
Far Rockaway High School Far Rockaway High School was a public high school in New York City, at 821 Bay 25th Street in Far Rockaway in the borough of Queens. It operated from 1897 to 2011. Its alumni include three Nobel Prize laureates and convicted fraudster Ber ...
in 1956. Madoff attended the
University of Alabama The University of Alabama (informally known as Alabama, UA, or Bama) is a public research university in Tuscaloosa, Alabama. Established in 1820 and opened to students in 1831, the University of Alabama is the oldest and largest of the public ...
for one year, where he became a brother of the Tau Chapter of the Sigma Alpha Mu fraternity, then transferred to and graduated from Hofstra University in 1960 with a Bachelor of Arts in political science. Madoff briefly attended
Brooklyn Law School Brooklyn Law School (BLS) is a private law school in New York City. Founded in 1901, it has approximately 1,100 students. Brooklyn Law School's faculty includes 60 full-time faculty, 15 emeriti faculty, and a number of adjunct faculty. Brooklyn ...
, but left after his first year to found Bernard L. Madoff Investment Securities LLC and work for himself.


Career

In 1960, Madoff founded Bernard L. Madoff Investment Securities LLC as a penny stock
broker-dealer In financial services, a broker-dealer is a natural person, company or other organization that engages in the business of trading securities for its own account or on behalf of its customers. Broker-dealers are at the heart of the securities and ...
with $5,000 () that he earned from working as a lifeguard and irrigation sprinkler installer and a loan of $50,000 from his father-in-law, accountant Saul Alpern, who referred a circle of friends and their families. Carl J. Shapiro was one such early customer, investing $100,000. Initially, the firm made markets ( quoted bid and ask prices) via the National Quotation Bureau's Pink Sheets. In order to compete with firms that were members of the New York Stock Exchange trading on the stock exchange's floor, his firm began using innovative computer information technology to disseminate its quotes. After a trial run, the technology that the firm helped to develop became the National Association of Securities Dealers Automated Quotations Stock Market ( NASDAQ). After 41 years as a sole proprietorship, the Madoff firm incorporated in 2001 as a limited liability company with Madoff as the sole shareholder. The firm functioned as a
third market In finance, third market is the trading of exchange-listed securities in the over-the-counter (OTC) market. These trades allow institutional investors to trade blocks of securities directly, rather than through an exchange, providing liquidity ...
trading provider, bypassing exchange specialist firms by directly executing orders over the counter from retail brokers. At one point, Madoff Securities was the largest
market maker A market maker or liquidity provider is a company or an individual that quotes both a buy and a sell price in a tradable asset held in inventory, hoping to make a profit on the '' bid–ask spread'', or ''turn.'' The benefit to the firm is that i ...
at the NASDAQ, and in 2008 was the sixth-largest market maker in
S&P 500 The Standard and Poor's 500, or simply the S&P 500, is a stock market index tracking the stock performance of 500 large companies listed on stock exchanges in the United States. It is one of the most commonly followed equity indices. As of ...
stocks. The firm also had an investment management and advisory division, which it did not publicize, that was the focus of the fraud investigation. Madoff was "the first prominent practitioner" of
payment for order flow Payment for order flow (PFOF) is the compensation that a stockbroker receives from a market maker in exchange for the broker routing its clients' trades to that market maker. It is a controversial practice that has been called a " kickback" by its ...
, in which a dealer pays a broker for the right to execute a customer's order. This has been called a "legal kickback". Some academics have questioned the ethics of these payments. Madoff argued that these payments did not alter the price that the customer received. He viewed the payments as a normal business practice: Madoff was active in the
National Association of Securities Dealers The Financial Industry Regulatory Authority (FINRA) is a private American corporation that acts as a self-regulatory organization (SRO) that regulates member brokerage firms and exchange markets. FINRA is the successor to the National Associat ...
(NASD), a self-regulatory securities-industry organization. He served as chairman of its board of directors, and was a member of its
board of governors A board of directors (commonly referred simply as the board) is an executive committee that jointly supervises the activities of an organization, which can be either a for-profit or a nonprofit organization such as a business, nonprofit organiz ...
.


Government access

From 1991 to 2008, Bernie and Ruth Madoff contributed about $240,000 to federal candidates, parties, and committees, including $25,000 a year from 2005 through 2008 to the
Democratic Senatorial Campaign Committee The Democratic Senatorial Campaign Committee (DSCC) is the Democratic Hill committee for the United States Senate. It is the only organization solely dedicated to electing Democrats to the United States Senate. The DSCC's current Chair is S ...
. The committee returned $100,000 of the Madoffs' contributions to Irving Picard, the
bankruptcy Bankruptcy is a legal process through which people or other entities who cannot repay debts to creditors may seek relief from some or all of their debts. In most jurisdictions, bankruptcy is imposed by a court order, often initiated by the debto ...
trustee who oversees all claims, and Senator
Charles E. Schumer Charles Ellis Schumer ( ; born November 23, 1950) is an American politician serving as Senate Majority Leader since January 20, 2021. A member of the Democratic Party, Schumer is in his fourth Senate term, having held his seat since 1999, and ...
returned almost $30,000 received from Madoff and his relatives to the trustee. Senator Christopher J. Dodd donated $1,500 to the Elie Wiesel Foundation for Humanity, a Madoff victim. Members of the Madoff family have served as leaders of the
Securities Industry and Financial Markets Association The Securities Industry and Financial Markets Association (SIFMA) is a United States industry trade group representing securities firms, banks, and asset management companies. SIFMA was formed on November 1, 2006, from the merger of the Bond Mar ...
(SIFMA), the primary securities industry organization. Bernard Madoff served on the board of directors of the Securities Industry Association, a precursor of SIFMA, and was chairman of its trading committee. He was a founding board member of the Depository Trust & Clearing Corporation (DTCC) subsidiary in London, the International Securities Clearing Corporation. Madoff's brother Peter served two terms as a member of SIFMA's board of directors. He and Andrew received awards from SIFMA in 2008 for "extraordinary leadership and service". He resigned from the board of directors of SIFMA in December 2008, as news of the Ponzi scheme broke. From 2000 to 2008, the Madoff brothers donated $56,000 directly to SIFMA, and paid additional money as sponsors of industry meetings. Bernard Madoff's niece
Shana Madoff Shana Diane Madoff ( ; born December 8, 1967), sometimes referred to as Shana Madoff Skoller Swanson, is an American former attorney who is now a yoga teacher. She is the daughter of Peter Madoff, and a niece of Bernie Madoff, who employed her ...
was a member of the executive committee of SIFMA's Compliance & Legal Division, but resigned shortly after the arrest. Madoff's name first came up in a fraud investigation in 1992, when two people complained to the SEC about investments they made with Avellino & Bienes, the successor to his father-in-law's accounting practice. For years, Alpern and two of his colleagues, Frank Avellino and Michael Bienes, had raised money for Madoff, a practice that continued after Avellino and Bienes took over the firm in the 1970s. Avellino returned the money to investors and the SEC closed the case. In 2004,
Genevievette Walker-Lightfoot Genevievette Walker-Lightfoot is a former U.S. Securities and Exchange Commission (SEC) attorney. She worked on the Bernard Madoff investigation in 2004, as the Lead Investigator for the SEC on the case. She discovered key elements of the Madoff ...
, a lawyer in the SEC's Office of Compliance Inspections and Examinations (OCIE), informed her supervisor branch chief Mark Donohue that her review of Madoff found numerous inconsistencies, and recommended further questioning. However, she was told by Donohue and his boss
Eric Swanson Eric J. Swanson is an American lawyer who worked at the U.S. Securities and Exchange Commission (SEC) and dated and eventually married the niece of Bernard Madoff while the SEC was investigating Madoff's investment firm for what was eventually r ...
to stop work on the Madoff investigation, send them her work results, and instead investigate the mutual fund industry. Swanson, assistant director of the SEC's OCIE, had met Shana Madoff in 2003 while investigating her uncle Bernie Madoff and his firm. The investigation was concluded in 2005. In 2006, Swanson left the SEC and became engaged to Shana Madoff, and in 2007 the two married. A spokesman for Swanson said he "did not participate in any inquiry of Bernard Madoff Securities or its affiliates while involved in a relationship" with Shana Madoff. While awaiting sentencing, Madoff met with the SEC's
inspector general An inspector general is an investigative official in a civil or military organization. The plural of the term is "inspectors general". Australia The Inspector-General of Intelligence and Security (Australia) (IGIS) is an independent statutory of ...
,
H. David Kotz H. David Kotz, also known as Harold David Kotz (born June 24, 1966), is a managing director at Berkeley Research Group. Kotz was a litigation associate at three law firms from 1990–99, and then a labor attorney at the U.S. Agency for Internat ...
, who conducted an investigation into how regulators had failed to detect the fraud despite numerous red flags. Madoff said he could have been caught in 2003, but that bumbling investigators had acted like " Lt. Columbo" and never asked the right questions: Madoff said in the June 17, 2009, interview that SEC Chairman
Mary Schapiro Mary Lovelace Schapiro (born June 19, 1955) served as the 29th Chair of the U.S. Securities and Exchange Commission (SEC). She was appointed by President Barack Obama, unanimously confirmed by the U.S. Senate, and assumed the Chairship on January ...
was a "dear friend", and SEC Commissioner Elisse Walter was a "terrific lady" whom he knew "pretty well". After Madoff's arrest, the SEC was criticized for its lack of financial expertise and lack of due diligence, despite having received complaints from
Harry Markopolos Harry M. Markopolos (born October 22, 1956) is an American former securities industry executive and a forensic accounting and financial fraud investigator. From 1999 to 2008, Markopolos uncovered evidence that suggested that Bernie Madoff's we ...
and others for almost a decade. The SEC's inspector general, Kotz, found that since 1992, there had been six investigations of Madoff by the SEC, which were botched either through incompetent staff work or by neglecting allegations of financial experts and whistle-blowers. At least some of the SEC investigators doubted whether Madoff was even trading. Due to concerns of improper conduct by Inspector General Kotz in the Madoff investigation, Inspector General David C. Williams of the United States Postal Service was brought in to conduct an independent outside review. The Williams Report questioned Kotz's work on the Madoff investigation, because Kotz was a "very good friend" with Markopolos. Investigators were not able to determine when Kotz and Markopolos became friends. A violation of the ethics rule would have taken place if the friendship were concurrent with Kotz's investigation of Madoff.


Investment scandal

In 1999, financial analyst
Harry Markopolos Harry M. Markopolos (born October 22, 1956) is an American former securities industry executive and a forensic accounting and financial fraud investigator. From 1999 to 2008, Markopolos uncovered evidence that suggested that Bernie Madoff's we ...
had informed the SEC that he believed it was legally and mathematically impossible to achieve the gains Madoff claimed to deliver. According to Markopolos, it took him four minutes to conclude that Madoff's numbers did not add up, and another minute to suspect they were fraudulent. After four hours of failed attempts to replicate Madoff's numbers, Markopolos believed he had mathematically proven Madoff was a fraud. He was ignored by the SEC's Boston office in 2000 and 2001, as well as by Meaghan Cheung at the SEC's New York office in 2005 and 2007 when he presented further evidence. He has since co-authored a book with Gaytri D. Kachroo, the leader of his legal team, titled ''No One Would Listen''. The book details the frustrating efforts he and his legal team made over a ten-year period to alert the government, the industry, and the press about Madoff's fraud. Although Madoff's wealth management business ultimately grew into a multibillion-dollar operation, none of the major derivatives firms traded with him because they did not believe his numbers were real. None of the major Wall Street firms invested with him, and several high-ranking executives at those firms suspected his operations and claims were not legitimate. Others contended it was inconceivable that the growing volume of Madoff's accounts could be competently and legitimately serviced by his documented accounting/auditing firm, a three-person firm with only one active accountant. The
Central Bank of Ireland The Central Bank of Ireland ( ga, Banc Ceannais na hÉireann) is Ireland's central bank, and as such part of the European System of Central Banks (ESCB). It is the country's financial services regulator for most categories of financial firms ...
failed to spot Madoff's gigantic fraud when he started using Irish funds and had to supply large amounts of information, which would have been enough to enable Irish regulators to uncover the fraud much earlier than late 2008 when he was finally arrested in
New York New York most commonly refers to: * New York City, the most populous city in the United States, located in the state of New York * New York (state), a state in the northeastern United States New York may also refer to: Film and television * ...
. The Federal Bureau of Investigation report and federal prosecutors' complaint says that during the first week of December 2008, Madoff confided to a senior employee, identified by Bloomberg News as one of his sons, that he said he was struggling to meet $7 billion in redemptions. For years, Madoff had simply deposited investors' money in his business account at
JPMorgan Chase JPMorgan Chase & Co. is an American multinational investment bank and financial services holding company headquartered in New York City and incorporated in Delaware. As of 2022, JPMorgan Chase is the largest bank in the United States, the w ...
and withdrew money from that account when they requested redemptions. He had scraped together just enough money to make a redemption payment on November 19. However, despite cash infusions from several longtime investors, by the week after Thanksgiving it was apparent that there was not enough money to even begin to meet the remaining requests. His Chase account had over $5.5 billion in mid-2008, but by late November was down to $234 million, not even a fraction of the outstanding redemptions. With banks having all stopped lending, Madoff knew he could not even begin to borrow the money he needed. On December 3, he told longtime assistant
Frank DiPascali Frank DiPascali, Jr. (October 28, 1956 – May 7, 2015) was an American financier and fraudster who was a key lieutenant of Bernie Madoff for three decades. He referred to himself as the company's "director of options trading" and as "chief finan ...
, who had overseen the fraudulent advisory business, that he was finished. On December 9, he told his brother Peter about the fraud. According to the sons, Madoff told Mark Madoff on the following day, December 9, that he planned to pay out $173 million in bonuses two months early. Madoff said that "he had recently made profits through business operations, and that now was a good time to distribute it." Mark told Andrew Madoff, and the next morning they went to their father's office and asked him how he could pay bonuses to his staff if he was having trouble paying clients. They then traveled to Madoff's apartment, where with Ruth Madoff nearby, Madoff told them he was "finished," that he had "absolutely nothing" left, and that his investment fund was "just one big lie" and "basically, a giant Ponzi scheme." According to their attorney, Madoff's sons then reported their father to federal authorities. Madoff had intended to wind up his operations over the remainder of the week before having his sons turn him in; he directed DiPascali to use the remaining money in his business account to cash out the accounts of several family members and favored friends. However, as soon as they left their father's apartment, Mark and Andrew immediately contacted a lawyer, who in turn got them in touch with federal prosecutors and the SEC. On December 11, 2008, Madoff was arrested and charged with
securities fraud Securities fraud, also known as stock fraud and investment fraud, is a deceptive practice in the stock or commodities markets that induces investors to make purchase or sale decisions on the basis of false information, frequently resulting in lo ...
. Madoff posted $10 million bail in December 2008 and remained under 24-hour monitoring and house arrest in his
Upper East Side The Upper East Side, sometimes abbreviated UES, is a neighborhood in the borough of Manhattan in New York City, bounded by 96th Street to the north, the East River to the east, 59th Street to the south, and Central Park/Fifth Avenue to the wes ...
penthouse apartment A penthouse is an apartment or unit on the highest floor of an apartment building, condominium, hotel or tower. Penthouses are typically differentiated from other apartments by luxury features. The term 'penthouse' originally referred, and s ...
until March 12, 2009, when Judge
Denny Chin Denny Chin (陳卓光; born April 13, 1954) is a Senior United States circuit judge of the United States Court of Appeals for the Second Circuit, based in New York City. He was a United States District Judge of the United States District Court ...
revoked his bail and remanded him to the Metropolitan Correctional Center. Chin ruled that Madoff was a flight risk because of his age, his wealth, and the prospect of spending the rest of his life in prison. Prosecutors filed two
asset In financial accounting, an asset is any resource owned or controlled by a business or an economic entity. It is anything (tangible or intangible) that can be used to produce positive economic value. Assets represent value of ownership that can b ...
forfeiture pleadings which include lists of valuable real and personal property as well as financial interests and entities owned or controlled by Madoff. Madoff's lawyer,
Ira Sorkin Ira Lee Sorkin (born May 30, 1943) is an American attorney. He is best known for representing Bernard Madoff, the American businessman who pleaded guilty to perpetrating the largest investor fraud ever committed by a single person. Education and ...
, filed an
appeal In law, an appeal is the process in which cases are reviewed by a higher authority, where parties request a formal change to an official decision. Appeals function both as a process for error correction as well as a process of clarifying and ...
, which prosecutors opposed. On March 20, 2009, an appellate court denied Madoff's request to be released from jail and returned to home confinement until his sentencing on June 29, 2009. On June 22, 2009, Sorkin hand-delivered a customary pre-sentencing letter to the judge requesting a sentence of 12 years, because of tables from the Social Security Administration that his life span was predicted to be 13 years. On June 26, 2009, Chin ordered forfeiture of $170 million in Madoff's assets. Prosecutors asked Chin to sentence Madoff to 150 years in prison.
Bankruptcy Trustee A trustee in bankruptcy is an entity, often an individual, in charge of administering a bankruptcy estate. Canada In Canada, a licensed insolvency trustee (LIT) is an individual or a corporation licensed by the official superintendent to hold ...
Irving Picard indicated that "Mr. Madoff has not provided meaningful cooperation or assistance." In
settlement Settlement may refer to: * Human settlement, a community where people live *Settlement (structural), the distortion or disruption of parts of a building *Closing (real estate), the final step in executing a real estate transaction *Settlement (fin ...
with federal prosecutors, Madoff's wife Ruth agreed to forfeit her claim to $85 million in assets, leaving her with $2.5 million in cash. The order allowed the SEC and Court appointed trustee Irving Picard to pursue Ruth Madoff's funds. Massachusetts regulators also accused her of withdrawing $15 million from company-related accounts shortly before he confessed. In February 2009, Madoff reached an agreement with the SEC. It was later revealed that as part of the agreement, Madoff accepted a lifetime ban from the securities industry. Picard sued Madoff's sons, Mark and Andrew, his brother Peter, and Peter's daughter, Shana, for
negligence Negligence (Lat. ''negligentia'') is a failure to exercise appropriate and/or ethical ruled care expected to be exercised amongst specified circumstances. The area of tort law known as ''negligence'' involves harm caused by failing to act as a ...
and breach of fiduciary duty, for $198 million. The defendants had received over $80 million in compensation since 2001.


Mechanics of the fraud

According to an SEC indictment, office workers Annette Bongiorno and Joann Crupi created false trading reports based on the returns that Madoff ordered for each customer. For example, when Madoff determined a customer's return, one of the back office workers would enter a false trade report with a previous date and then enter a false closing trade in the amount required to produce the required profit, according to the indictment. Prosecutors allege that Bongiorno used a computer program specially designed to backdate trades and manipulate account statements. They quote her as writing to a manager in the early 1990s, "I need the ability to give any settlement date I want." In some cases, returns were allegedly determined before the account was even opened. On a daily basis, DiPascali and his team on the 17th floor of the
Lipstick Building The Lipstick Building, also known as 885 Third Avenue and 53rd at Third, is a 453-foot (138 meter) tall skyscraper at Third Avenue between 53rd Street and 54th Street in the Midtown Manhattan neighborhood of New York City. It was completed in ...
, where the scam was based (Madoff's brokerage was based on the 19th floor, while the main entrance and conference room were on the 18th floor), watched the closing price of the
S&P 100 The S&P 100 Index is a stock market index of United States stocks maintained by Standard & Poor's. Index options on the S&P 100 are traded with the ticker symbol "OEX". Because of the popularity of these options, investors often refer to the i ...
. They then picked the best-performing stocks and used them to create bogus "baskets" of stocks as the basis for false trading records, which Madoff claimed were generated from his supposed " split-strike conversion" strategy, in which he bought blue-chip stocks and took options contracts on them. They frequently made their "trades" at a stock's monthly high or low, resulting in the high "returns" that they touted to customers. On occasion, they slipped up and dated trades as taking place on weekends and federal holidays, though this was never caught. Over the years, Madoff admonished his investors to keep quiet about their relationship with him. This was because he was well aware of the finite limits that existed for a legitimate split-strike conversion. He knew that if the amount he "managed" became known, investors would question whether he could trade on the scale he claimed without the market reacting to his activity, or whether there were enough options to
hedge A hedge or hedgerow is a line of closely spaced shrubs and sometimes trees, planted and trained to form a barrier or to mark the boundary of an area, such as between neighbouring properties. Hedges that are used to separate a road from adjoi ...
his stock purchases. As early as 2001,
Harry Markopolos Harry M. Markopolos (born October 22, 1956) is an American former securities industry executive and a forensic accounting and financial fraud investigator. From 1999 to 2008, Markopolos uncovered evidence that suggested that Bernie Madoff's we ...
discovered that in order for Madoff's strategy to be legitimate, he would have had to buy more options on the
Chicago Board Options Exchange The Chicago Board Options Exchange (CBOE), located at 433 West Van Buren Street in Chicago, is the largest U.S. options exchange with an annual trading volume of around 1.27 billion at the end of 2014. CBOE offers options on over 2,200 companies ...
than actually existed. Additionally, at least one hedge-fund manager, Suzanne Murphy, revealed that she balked at investing with Madoff because she did not believe there was enough volume to support his purported trading activity. Madoff admitted during his March 2009 guilty plea that the essence of his scheme was to deposit client money into a bank account, rather than invest it and generate steady returns as clients had believed. When clients wanted their money, "I used the money in the Chase Manhattan bank account that belonged to them or other clients to pay the requested funds," he told the court. Madoff maintained that he began his fraud in the early 1990s, though prosecutors believed it was underway as early as the 1980s. DiPascali, for instance, told prosecutors that he knew at some point in the late 1980s or early 1990s that the investment advisory business was a sham. An investigator charged with reconstructing Madoff's scheme believes that the fraud was well under way as early as 1964. Reportedly, Madoff told an acquaintance soon after his arrest that the fraud began "almost immediately" after his firm opened its doors. Bongiorno, who spent over 40 years with Madoff–longer than anyone except Ruth and Peter–told investigators that she was doing "the same things she was doing in 2008" when she first joined the firm.


Affinity fraud

Madoff targeted wealthy American Jewish communities, using his in-group status to obtain investments from Jewish individuals and institutions. Affected Jewish charitable organizations considered victims of this
affinity fraud Affinity fraud is a form of investment fraud in which the fraudster preys upon members of identifiable groups, such as religious or ethnic communities, language minorities, the elderly, or professional groups. The fraudsters who promote affinity ...
include Hadassah, the Women's Zionist Organization of America, the
Elie Wiesel Foundation Elie Wiesel (, born Eliezer Wiesel ''Eliezer Vizel''; September 30, 1928 – July 2, 2016) was a Romanian-born American writer, professor, political activist, Nobel laureate, and Holocaust survivor. He authored 57 books, written mostly in Fre ...
and Steven Spielberg's Wunderkinder Foundation. Jewish federations and hospitals lost millions of dollars, forcing some organizations to close. The Lappin Foundation, for instance, was forced to close temporarily because it had invested its funds with Madoff.


Size of loss to investors

David Sheehan David Sheehan (March 31, 1938 – December 1, 2020) was an American broadcaster, interviewer, host and reporter. Starting in 1970 on CBS, Sheehan was a reviewer and interviewer covering movies and television on a daily local newscast. He went on t ...
, chief counsel to trustee Picard, stated on September 27, 2009, that about $36 billion was invested into the scam, returning $18 billion to investors, with $18 billion missing. About half of Madoff's investors were "net winners," earning more than their investment. The withdrawal amounts in the final six years were subject to "clawback" (return of money) lawsuits. In a May 4, 2011, statement, trustee Picard said that the total amount owed to customers (with some adjustments) was $57 billion, of which $17.3 billion was actually invested by customers. $7.6 billion has been recovered, but pending lawsuits, only $2.6 billion was available to repay victims. The Internal Revenue Service ruled that investors' capital losses in this and other fraudulent investment schemes would be treated as business losses, thereby allowing the victims to claim a tax deduction for such losses. The size of the fraud was stated as $65 billion early in the investigation. Former SEC Chairman
Harvey Pitt Harvey L. Pitt (born February 28, 1945) is an American lawyer who served as the 26th chairman of the U.S. Securities and Exchange Commission (SEC), from 2001 to 2003. History Pitt graduated from Stuyvesant High School in 1961. He graduated f ...
estimated the actual net fraud to be between $10 and $17 billion. One difference between the estimates results from different methods of calculation. One method calculates losses as the total amount that victims thought they were owed, but will never receive. The smaller estimates are arrived at by subtracting the total cash received from the scheme from the total cash paid into the scheme, after excluding from the calculation persons accused of collaborating with the scheme, persons who invested through "feeder funds," and anyone who received more cash from the scheme than they paid in. Erin Arvedlund, who publicly questioned Madoff's reported investment performance in 2001, stated that the actual amount of the fraud might never be known, but was likely between $12 and $20 billion. Jeffry Picower, rather than Madoff, appears to have been the largest beneficiary of Madoff's Ponzi scheme, and his estate settled the claims against it for $7.2 billion. Entities and individuals affiliated with Fred Wilpon and Saul Katz received $300 million in respect of investments in the scheme. Wilpon and Katz "categorically reject d the charge that they "ignored warning signs" about Madoff's fraud. On November 9, 2017, the U.S. government announced that it would begin paying out $772.5 million from the Madoff Victim Fund to more than 24,000 victims of the Ponzi scheme. The Madoff Recovery Initiative reported $14.418 billion in total recoveries and settlement agreements.


Plea, sentencing, and prison life

On March 12, 2009, Madoff pleaded guilty to 11 federal felonies, including
securities fraud Securities fraud, also known as stock fraud and investment fraud, is a deceptive practice in the stock or commodities markets that induces investors to make purchase or sale decisions on the basis of false information, frequently resulting in lo ...
, wire fraud,
mail fraud Mail fraud and wire fraud are terms used in the United States to describe the use of a physical or electronic mail system to defraud another, and are federal crimes there. Jurisdiction is claimed by the federal government if the illegal activit ...
, money laundering,
making false statements Making false statements () is the common name for the United States federal process crime laid out in Section 1001 of Title 18 of the United States Code, which generally prohibits knowingly and willfully making false or fraudulent statements, o ...
, perjury, theft from an employee benefit plan, and making false filings with the SEC. The plea was the response to a criminal complaint filed two days earlier, which stated that over the past 20 years, Madoff had defrauded his clients of almost $65 billion in the largest
Ponzi scheme A Ponzi scheme (, ) is a form of fraud that lures investors and pays profits to earlier investors with funds from more recent investors. Named after Italian businessman Charles Ponzi, the scheme leads victims to believe that profits are comi ...
in history. Madoff insisted he was solely responsible for the fraud. He pleaded guilty to all charges without a plea bargain; it has been speculated that he did this instead of cooperating with the authorities in order to avoid naming any associates and co-conspirators in the scheme. In November 2009, David G. Friehling, Madoff's accounting front man and auditor, pleaded guilty to
securities fraud Securities fraud, also known as stock fraud and investment fraud, is a deceptive practice in the stock or commodities markets that induces investors to make purchase or sale decisions on the basis of false information, frequently resulting in lo ...
, investment adviser fraud, making false filings to the SEC, and obstructing the Internal Revenue Service. He admitted to merely rubber-stamping Madoff's filings rather than auditing them. Friehling extensively cooperated with federal prosecutors and testified at the trials of five former Madoff employees, all of whom were convicted and sentenced to between 2 and a half and 10 years in prison. Although he could have been sentenced to more than 100 years in prison, because of his cooperation, Friehling was sentenced in May 2015 to one year of home detention and one year of supervised release. His involvement made the Madoff scheme by far the largest accounting fraud in history, dwarfing the $11 billion accounting fraud masterminded by
Bernard Ebbers Bernard John Ebbers (August 27, 1941 – February 2, 2020) was a Canadian businessman, the co-founder and CEO of WorldCom and a convicted fraudster. Under his management, WorldCom grew rapidly but collapsed in 2002 amid revelations of accounting ...
in the WorldCom scandal. Madoff's right-hand man and financial chief,
Frank DiPascali Frank DiPascali, Jr. (October 28, 1956 – May 7, 2015) was an American financier and fraudster who was a key lieutenant of Bernie Madoff for three decades. He referred to himself as the company's "director of options trading" and as "chief finan ...
, pleaded guilty to 10 federal charges in 2009 and (like Friehling) testified for the government at the trial of five former colleagues, all of whom were convicted. DiPascali faced a sentence of up to 125 years, but he died of lung cancer in May 2015, before he could be sentenced. In his plea
allocution An allocution, or allocutus, is a formal statement made to the court by the defendant who has been found guilty prior to being sentenced. It is part of the criminal procedure in some jurisdictions using common law. Concept An allocution al ...
, Madoff stated he began his Ponzi scheme in 1991. He admitted he had never made any legitimate investments with his clients' money during this time. Instead, he said, he simply deposited the money into his personal business account at
Chase Manhattan Bank JPMorgan Chase Bank, N.A., doing business as Chase Bank or often as Chase, is an American national bank headquartered in New York City, that constitutes the consumer and commercial banking subsidiary of the U.S. multinational banking and fina ...
. When his customers asked for withdrawals, he paid them out of the Chase account—a classic " robbing Peter to pay Paul" scenario. Chase and its successor,
JPMorgan Chase JPMorgan Chase & Co. is an American multinational investment bank and financial services holding company headquartered in New York City and incorporated in Delaware. As of 2022, JPMorgan Chase is the largest bank in the United States, the w ...
, may have earned as much as $483 million from his bank account. He was committed to satisfying his clients' expectations of high returns, despite an economic recession. He admitted to false trading activities masked by foreign transfers and false SEC filings. He stated that he always intended to resume legitimate trading activity, but it proved "difficult, and ultimately impossible" to reconcile his client accounts. In the end, he said, he realized that his scam would eventually be exposed. On June 29, 2009, Judge Chin sentenced him to the maximum sentence of 150 years in federal prison. His lawyers initially asked the judge to impose a sentence of 7 years, and later requested that the sentence be 12 years, because of Madoff's advanced age of 71 and his limited life expectancy. Madoff apologized to his victims, saying, Judge Chin had not received any mitigating factor letters from friends or family testifying to Madoff's good deeds. "The absence of such support was telling," he said. Judge Chin also said that Madoff had not been forthcoming about his crimes. "I have a sense Mr. Madoff has not done all that he could do or told all that he knows," said Chin, calling the fraud "extraordinarily evil", "unprecedented", and "staggering", and that the sentence would deter others from committing similar frauds. Judge Chin also agreed with prosecutors' contention that the fraud began at some point in the 1980s. He also noted that Madoff's crimes were "off the charts", since federal sentencing guidelines for fraud only go up to $400 million in losses. Ruth did not attend court but issued a statement, saying: "I am breaking my silence now because my reluctance to speak has been interpreted as indifference or lack of sympathy for the victims of my husband Bernie's crime, which was exactly the opposite of the truth. I am embarrassed and ashamed. Like everyone else, I feel betrayed and confused. The man who committed this horrible fraud was not the man whom I have known for all these years."


Incarceration

Madoff's attorney asked the judge to recommend that the
Federal Bureau of Prisons The Federal Bureau of Prisons (BOP) is a United States federal law enforcement agency under the Department of Justice that is responsible for the care, custody, and control of incarcerated individuals who have committed federal crimes; that ...
place Madoff in the
Federal Correctional Institution, Otisville The Federal Correctional Institution, Otisville (FCI Otisville) is a medium-security United States federal prison for male inmates located near Otisville, New York. It is operated by the Federal Bureau of Prisons (BOP), a division of the United ...
, which was located from Manhattan. The judge, however, only recommended that Madoff be sent to a facility in the
Northeast United States The Northeastern United States, also referred to as the Northeast, the East Coast, or the American Northeast, is a geographic region of the United States. It is located on the Atlantic coast of North America, with Canada to its north, the Southe ...
. He was transferred to the Federal Correctional Institution Butner Medium near
Butner, North Carolina Butner is a town in Granville County, North Carolina, United States. The population was 8,397 as of the 2020 census. Butner was managed by the state of North Carolina from 1947 through 2007. History A bill passed by the North Carolina General ...
, about northwest of
Raleigh Raleigh (; ) is the capital city of the state of North Carolina and the seat of Wake County in the United States. It is the second-most populous city in North Carolina, after Charlotte. Raleigh is the tenth-most populous city in the Southeas ...
; he was Bureau of Prisons Register #61727-054. Jeff Gammage of '' The Philadelphia Inquirer'' said, in regards to his prison assignment, "Madoff's heavy sentence likely determined his fate." Madoff's projected release date was January 31, 2137. The release date, described as "academic" in Madoff's case because he would have to live to the age of 198, reflects a reduction for good behavior. On October 13, 2009, it was reported that Madoff experienced his first prison yard fight with another inmate, also a senior citizen. When he began his sentence, Madoff's stress levels were so severe that he broke out in
hives Hives, also known as urticaria, is a kind of skin rash with red, raised, itchy bumps. Hives may burn or sting. The patches of rash may appear on different body parts, with variable duration from minutes to days, and does not leave any long-lasti ...
and other skin maladies soon after. On December 18, 2009, Madoff was moved to Duke University Medical Center in
Durham, North Carolina Durham ( ) is a city in the U.S. state of North Carolina and the county seat of Durham County. Small portions of the city limits extend into Orange County and Wake County. With a population of 283,506 in the 2020 Census, Durham is the 4th- ...
, and was treated for several facial injuries. A former inmate later claimed that the injuries were received during an alleged altercation with another inmate. Other news reports described Madoff's injuries as more serious and including "facial fractures, broken ribs, and a collapsed lung". The Federal Bureau of Prisons said Madoff signed an
affidavit An ( ; Medieval Latin for "he has declared under oath") is a written statement voluntarily made by an ''affiant'' or '' deponent'' under an oath or affirmation which is administered by a person who is authorized to do so by law. Such a statemen ...
on December 24, 2009, which indicated that he had not been assaulted and that he had been admitted to the hospital for hypertension. In his letter to his daughter-in-law, Madoff said that he was being treated in prison like a " Mafia don". After an inmate slapped Madoff because he had changed the channel on the TV, it was reported that Madoff befriended
Carmine Persico Carmine John Persico Jr. (; August 8, 1933 – March 7, 2019), also known as "Junior", "The Snake" and "Immortal", was an American mobster and the longtime boss of the Colombo crime family in New York City from 1973 until his death in 2019. He h ...
, boss of the
Colombo crime family The Colombo crime family (, ) is an Italian American Mafia crime family and is the youngest of the "Five Families" that dominate organized crime activities in New York City within the criminal organization known as the American Mafia. It was dur ...
since 1973, one of New York's five American Mafia families. It was believed Persico had intimidated the inmate who slapped Madoff in the face. On July 29, 2019, Madoff asked Donald Trump for a reduced sentence or pardon, to which the White House and Donald Trump made no comment. In February 2020, his lawyer filed for
compassionate release Compassionate release is a process by which inmates in criminal justice systems may be eligible for immediate early release on grounds of "particularly extraordinary or compelling circumstances which could not reasonably have been foreseen by t ...
from prison on the claim that he had
chronic kidney failure Chronic kidney disease (CKD) is a type of kidney disease in which a gradual loss of kidney function occurs over a period of months to years. Initially generally no symptoms are seen, but later symptoms may include leg swelling, feeling tired, v ...
, a terminal illness leaving him less than 18 months to live, and that the COVID-19 pandemic further threatened his life. He was hospitalized for this condition in December 2019. The request was denied due to the severity of Madoff's crimes.


Death

Madoff died of natural causes at the age of 82 in
Federal Medical Center, Butner The Federal Medical Center, Butner (FMC Butner) is a United States federal prison in North Carolina for male inmates of all security levels who have special health needs. It is part of the Butner Federal Correctional Complex and is operated by th ...
, a federal prison for inmates with special health needs near
Butner, North Carolina Butner is a town in Granville County, North Carolina, United States. The population was 8,397 as of the 2020 census. Butner was managed by the state of North Carolina from 1947 through 2007. History A bill passed by the North Carolina General ...
, on April 14, 2021. A death certificate obtained by ''
TMZ TMZ is a tabloid news website owned by Fox Corporation. It made its debut on November 8, 2005, originally as a collaboration between AOL and Telepictures, a division of Warner Bros., until Time Warner divested AOL in 2009. On September 13, 2 ...
'' listed the cause of death as hypertension, atherosclerotic cardiovascular disease and
chronic kidney disease Chronic kidney disease (CKD) is a type of kidney disease in which a gradual loss of kidney function occurs over a period of months to years. Initially generally no symptoms are seen, but later symptoms may include leg swelling, feeling tired, vom ...
. According to the document, he was cremated in
Durham, North Carolina Durham ( ) is a city in the U.S. state of North Carolina and the county seat of Durham County. Small portions of the city limits extend into Orange County and Wake County. With a population of 283,506 in the 2020 Census, Durham is the 4th- ...
.


Personal life

Madoff met Ruth Alpern while attending
Far Rockaway High School Far Rockaway High School was a public high school in New York City, at 821 Bay 25th Street in Far Rockaway in the borough of Queens. It operated from 1897 to 2011. Its alumni include three Nobel Prize laureates and convicted fraudster Ber ...
. The two eventually began dating. Ruth graduated from high school in 1958, and earned her bachelor's degree at Queens College. On November 28, 1959, Madoff married Alpern. She was employed at the stock market in Manhattan before working in Madoff's firm, and she founded the Madoff Charitable Foundation. Bernard and Ruth Madoff had two sons: Mark (March 11, 1964 – December 11, 2010), a 1986 graduate of the University of Michigan, and Andrew (April 8, 1966 – September 3, 2014), a 1988 graduate of University of Pennsylvania's Wharton Business School. Both sons later worked in the trading section alongside paternal cousin Charles Weiner. Several family members worked for Madoff. His younger brother, Peter, an attorney, was senior managing director and chief compliance officer, and Peter's daughter,
Shana Madoff Shana Diane Madoff ( ; born December 8, 1967), sometimes referred to as Shana Madoff Skoller Swanson, is an American former attorney who is now a yoga teacher. She is the daughter of Peter Madoff, and a niece of Bernie Madoff, who employed her ...
, also an attorney, was the firm's compliance attorney. On the morning of December 11, 2010 – exactly two years after Bernard's arrest – his son Mark was found dead in his New York City apartment. The city medical examiner ruled the cause of death as
suicide by hanging Suicide by hanging is the intentional killing of oneself (suicide) via suspension from an anchor-point such as an overhead beam or hook, by a rope or cord or by jumping from a height with a noose around the neck. Hanging is often considered t ...
. Over the years, Madoff's sons had borrowed money from their parents, to purchase homes and other property. Mark Madoff owed his parents $22 million, and Andrew Madoff owed them $9.5 million. There were two loans in 2008 from Bernard Madoff to Andrew: $4.3 million on October 6, and $250,000 on September 21. Andrew owned a Manhattan apartment and a home in Greenwich, Connecticut, as did his brother Mark, prior to his death. Both sons used outside investment firms to run their own private philanthropic foundations. In March 2003, Andrew Madoff was diagnosed with
mantle cell lymphoma Mantle cell lymphoma (MCL) is a type of non-Hodgkin's lymphoma (NHL), comprising about 6% of NHL cases. There are only about 15,000 patients presently in the United States with mantle cell lymphoma. It is named for the mantle zone of the lymph n ...
and eventually returned to work. He was named chairman of the Lymphoma Research Foundation in January 2008, but resigned shortly after his father's arrest. Peter Madoff (and Andrew Madoff, before his death) remained the targets of a tax fraud investigation by federal prosecutors, according to '' The Wall Street Journal''. David Friehling, Bernard Madoff's tax accountant, who pleaded guilty in a related case, was reportedly assisting in the investigation. According to a civil lawsuit filed in October 2009, trustee Irving Picard alleges that Peter Madoff deposited $32,146 into his Madoff accounts and withdrew over $16 million; Andrew deposited almost $1 million into his accounts and withdrew $17 million; Mark deposited $745,482 and withdrew $18.1 million. Bernard Madoff lived in
Roslyn, New York Roslyn ( ) is a village in the Town of North Hempstead in Nassau County, on the North Shore of Long Island, in New York, United States. It is the Greater Roslyn area's anchor community. The population was 2,770 at the 2010 census. History Ro ...
, in a ranch house through the 1970s. In 1980, he purchased an ocean-front residence in Montauk, New York, for $250,000. His primary residence was on Manhattan's
Upper East Side The Upper East Side, sometimes abbreviated UES, is a neighborhood in the borough of Manhattan in New York City, bounded by 96th Street to the north, the East River to the east, 59th Street to the south, and Central Park/Fifth Avenue to the wes ...
, and he was listed as chairman of the building's
co-op A cooperative (also known as co-operative, co-op, or coop) is "an autonomous association of persons united voluntarily to meet their common economic, social and cultural needs and aspirations through a jointly owned and democratically-control ...
board. He also owned a home in France and an 8,700-square-foot house in Palm Beach, Florida, where he was a member of the Palm Beach Country Club, where he searched for targets of his fraud. Madoff owned a sportfishing yacht named ''Bull''. All three of his homes were auctioned by the
U.S. Marshals Service The United States Marshals Service (USMS) is a federal law enforcement agency in the United States. The USMS is a bureau within the U.S. Department of Justice, operating under the direction of the Attorney General, but serves as the enforceme ...
in September 2009. Sheryl Weinstein, former
chief financial officer The chief financial officer (CFO) is an officer of a company or organization that is assigned the primary responsibility for managing the company's finances, including financial planning, management of financial risks, record-keeping, and financi ...
of Hadassah, disclosed in a memoir that she and Madoff had had an affair more than 20 years earlier. As of 1997, when Weinstein left, Hadassah had invested a total of $40 million with Bernie Madoff. By the end of 2008, Hadassah had withdrawn more than $130 million from its Madoff accounts and contends its accounts were valued at $90 million at the time of Madoff's arrest. At the victim impact sentencing hearing, Weinstein testified, calling him a "beast". According to a March 13, 2009, filing by Madoff, he and his wife were worth up to $126 million, plus an estimated $700 million for the value of his business interest in Bernard L. Madoff Investment Securities LLC. During a 2011 interview on
CBS CBS Broadcasting Inc., commonly shortened to CBS, the abbreviation of its former legal name Columbia Broadcasting System, is an American commercial broadcast television and radio network serving as the flagship property of the CBS Entertainme ...
, Ruth Madoff claimed she and her husband had attempted suicide after his fraud was exposed, both taking "a bunch of pills" in a suicide pact on
Christmas Eve Christmas Eve is the evening or entire day before Christmas Day, the festival commemorating the birth of Jesus. Christmas Day is observed around the world, and Christmas Eve is widely observed as a full or partial holiday in anticipatio ...
2008. In November 2011, former Madoff employee David Kugel pleaded guilty to charges that arose out of the scheme. He admitted having helped Madoff create a phony paper trail, the false account statements that were supplied to clients. Bernard Madoff had a heart attack in December 2013, and reportedly had
end-stage renal disease Chronic kidney disease (CKD) is a type of kidney disease in which a gradual loss of kidney function occurs over a period of months to years. Initially generally no symptoms are seen, but later symptoms may include leg swelling, feeling tired, vom ...
(ESRD). According to CBS New York and other news sources, Madoff claimed in an email to CNBC in January 2014 that he had kidney cancer, but this was unconfirmed. In a court filing from his lawyer in February 2020, it was revealed Madoff had chronic kidney failure. On February 17, 2022, Madoff's sister, Sondra Weiner, and her husband, Marvin, were both found dead with gun wounds in their
Boynton Beach, Florida Boynton Beach is a city in Palm Beach County, Florida, United States. It is situated about 57 miles north of Miami. The population was 68,217 at the 2010 census. In 2019, the city had an estimated population of 78,679 according to the University o ...
home. The deaths of Sondra, 87, and Marvin, 90, were labeled by police as a potential murder-suicide.


Philanthropy and other activities

Madoff was a prominent
philanthropist Philanthropy is a form of altruism that consists of "private initiatives, for the public good, focusing on quality of life". Philanthropy contrasts with business initiatives, which are private initiatives for private good, focusing on material ...
, who served on boards of nonprofit institutions, many of which entrusted his firm with their endowments. The collapse and freeze of his personal assets and those of his firm affected businesses, charities, and foundations around the world, including the Chais Family Foundation, the Robert I. Lappin Charitable Foundation, the Picower Foundation, and the JEHT Foundation which were forced to close. Madoff donated approximately $6 million to lymphoma research after his son Andrew was diagnosed with the disease. He and his wife gave over $230,000 to political causes since 1991, with the bulk going to the
Democratic Party Democratic Party most often refers to: *Democratic Party (United States) Democratic Party and similar terms may also refer to: Active parties Africa * Botswana Democratic Party * Democratic Party of Equatorial Guinea *Gabonese Democratic Party *De ...
. Madoff served as the chairman of the board of directors of the
Sy Syms School of Business Syms School of Business (formerly the Syms School of Business) is Yeshiva University business school. It offers both undergraduate and graduate business programs at the Wilf Campus in New York Washington Heights neighborhood, and at the Beren Cam ...
at Yeshiva University, and as treasurer of its
board of trustees A board of directors (commonly referred simply as the board) is an executive committee that jointly supervises the activities of an organization, which can be either a for-profit or a nonprofit organization such as a business, nonprofit organi ...
. He resigned his position at Yeshiva University after his arrest. Madoff also served on the board of
New York City Center New York City Center (previously known as the Mecca Temple, City Center of Music and Drama,. The name "City Center for Music and Drama Inc." is the organizational parent of the New York City Ballet and, until 2011, the New York City Opera. and th ...
, a member of New York City's Cultural Institutions Group (CIG). He served on the executive council of the Wall Street division of the
UJA The United Jewish Appeal (UJA) was a Jewish philanthropic umbrella organization that existed from its creation in 1939 until it was folded into the United Jewish Communities, which was formed from the 1999 merger of United Jewish Appeal (UJA), Cou ...
Foundation of New York which declined to invest funds with him because of the conflict of interest. Madoff undertook charity work for the Gift of Life Bone Marrow Foundation and made philanthropic gifts through the Madoff Family Foundation, a $19 million private foundation, which he managed along with his wife. They also donated money to hospitals and theaters. The foundation also contributed to many educational, cultural, and health charities, including those later forced to close because of Madoff's fraud. After Madoff's arrest, the assets of the Madoff Family Foundation were frozen by a federal court.


In the media

* On May 12, 2009,
PBS The Public Broadcasting Service (PBS) is an American public broadcaster and non-commercial, free-to-air television network based in Arlington, Virginia. PBS is a publicly funded nonprofit organization and the most prominent provider of educati ...
Frontline aired ''The Madoff Affair'', and subsequently ShopPBS made DVD videos of the show and transcripts available for purchase by the public at large. * In season 7 of ''
Curb Your Enthusiasm ''Curb Your Enthusiasm'' is an American television sitcom produced and broadcast by HBO since October 15, 2000, and created by Larry David, who stars as a semi-fictionalized version of himself. It follows David's life as a semi-retired televisi ...
'', aired in 2009, the character
George Costanza George Louis Costanza is a fictional character in the American Television program, television Situation comedy, sitcom ''Seinfeld'' (1989–1998), played by Jason Alexander. He is a short, stocky, balding man who struggles with numerous insecur ...
(from '' Seinfeld'') loses all of the money he made from an app called iToilet by investing with Madoff. * '' Imagining Madoff'' was a 2010 play by
Deb Margolin Deb Margolin is an American performance artist and playwright. She came to prominence in the 1980s in the feminist political theatre troupe Split Britches, which she co-founded with Lois Weaver and Peggy Shaw. Margolin has since created a stri ...
that tells the story of an imagined encounter between Madoff and his victims. The play generated controversy when Elie Wiesel, originally portrayed as a character in the play, threatened legal action, forcing Margolin to substitute a fictional character, "Solomon Galkin". The play was nominated for a 2012 Helen Hayes Award. * A documentary, '' Chasing Madoff'', describing
Harry Markopolos Harry M. Markopolos (born October 22, 1956) is an American former securities industry executive and a forensic accounting and financial fraud investigator. From 1999 to 2008, Markopolos uncovered evidence that suggested that Bernie Madoff's we ...
' efforts to unmask the fraud, was released in August 2011. * Woody Allen's 2013 film '' Blue Jasmine'' portrays a fictional couple involved in a similar scandal. Allen said that the Madoff scandal was the inspiration for the film. * '' In God We Trust'' (2013), a documentary about Eleanor Squillari, Madoff's secretary for 25 years and her search for the truth about the fraud ( The Halcyon Company). * Madoff was played by Robert De Niro in the May 2017
HBO Home Box Office (HBO) is an American pay television, premium television network, which is the flagship property of namesake parent subsidiary Home Box Office, Inc., itself a unit owned by Warner Bros. Discovery. The overall Home Box Office busi ...
film ''
The Wizard of Lies ''The Wizard of Lies'' is a 2017 American television biopic film directed by Barry Levinson and written by Sam Levinson, Sam Baum, and John Burnham Schwartz, based on the 2011 non-fiction book of the same name by Diana B. Henriques. The film st ...
'', based on the best-selling book by Diana B. Henriques.
Michelle Pfeiffer Michelle Marie Pfeiffer (; born April 29, 1958) is an American actress and producer. A prolific performer whose screen work spans over four decades, she became one of Hollywood's most bankable stars and popular sex symbols during the 1980s a ...
plays Ruth Madoff in the film, which was released on May 20, 2017. * '' Madoff'', a miniseries by
ABC ABC are the first three letters of the Latin script known as the alphabet. ABC or abc may also refer to: Arts, entertainment, and media Broadcasting * American Broadcasting Company, a commercial U.S. TV broadcaster ** Disney–ABC Television ...
starring
Richard Dreyfuss Richard Stephen Dreyfuss (; born Dreyfus; October 29, 1947) is an American actor. He is known for starring in popular films during the 1970s, 1980s, and 1990s, including ''American Graffiti'' (1973), '' Jaws'' (1975), ''Close Encounters of the ...
and
Blythe Danner Blythe Katherine Danner (born February 3, 1943) is an American actress. Accolades she has received include two Primetime Emmy Awards for Best Supporting Actress in a Drama Series for her role as Izzy Huffstodt on '' Huff'' (2004–2006), and a ...
as Bernard and Ruth Madoff, aired on February 3 and 4, 2016. * "Ponzi Super Nova", an episode of the podcast
Radiolab ''Radiolab'' is a radio program produced by WNYC, a public radio station in New York City, and broadcast on public radio stations in the United States. The show is nationally syndicated and is available as a podcast. Live shows were first off ...
released February 10, 2017, in which Madoff was interviewed over prison phone. * Chevelle's song " Face to the Floor", as described by the band, was a "pissed off, angry" song about people who got taken by the Ponzi scheme that Bernie Madoff had for all those years." *The heroine of
Elin Hilderbrand Elin Hilderbrand is an American writer, mostly of romance novels. Her novels are typically set on and around Nantucket Island, where she resides."Huffington Post" Accessed 24 November 2008. She was born and raised in Collegeville, Pennsylvania, ...
's novel, ''Silver Girl'', published in 2011 by
Back Bay Books Little, Brown and Company is an American publishing company founded in 1837 by Charles Coffin Little and James Brown in Boston. For close to two centuries it has published fiction and nonfiction by American authors. Early lists featured Emily ...
, was the wife of a Madoff-like schemer. *
Cristina Alger Cristina is a female given name, and it is also a surname. Notable people with the name include: Given name *Cristina (daughter of Edward the Exile), 11th-century English princess *Cristina (singer), Cristina Monet-Palaci (1956–2020), American s ...
's novel, ''The Darlings'', published in 2012 by
Pamela Dorman Books Viking Press (formally Viking Penguin, also listed as Viking Books) is an American publishing company owned by Penguin Random House. It was founded in New York City on March 1, 1925, by Harold K. Guinzburg and George S. Oppenheim and then acquire ...
, features a wealthy family with a Madoff-like patriarch. *The action of James Grippando's thriller, ''Need You Now'', published in 2012 by HarperCollins, was set in motion by the suicide of the Bernie Madoff-like Ponzi schemer Abe Cushman. *The protagonist of
Elinor Lipman Elinor Lipman (born October 16, 1950) is an American novelist, short story writer, and essayist. Early life and education Elinor Lipman was born and raised in Lowell, Massachusetts to a Jewish family. She is the second daughter of Julia M. an ...
's novel, ''The View from Penthouse B'', published in 2013 by Houghton Mifflin Harcourt, loses her divorce settlement by investing it with Bernie Madoff. * Randy Susan Meyers's novel, ''The Widow of Wall Street'', published in 2017 by Atria Books, was a fictionalized account of the Madoff Ponzi scheme from the wife's point of view. *
Emily St. John Mandel Emily St. John Mandel (; born 1979) is a Canadian novelist and essayist. She has written six novels, including '' Station Eleven'' (2014) and '' The Glass Hotel'' (2020). ''Station Eleven'', which has been translated into 33 languages, has been ...
's novel, '' The Glass Hotel'', published in 2020 by
Alfred A. Knopf Alfred A. Knopf, Inc. () is an American publishing house that was founded by Alfred A. Knopf Sr. and Blanche Knopf in 1915. Blanche and Alfred traveled abroad regularly and were known for publishing European, Asian, and Latin American writers i ...
, includes a character named Jonathan Alkaitis, who was closely based on Madoff. * A Kaddish For Bernie Madoff (2021), a docudrama created by musician/poet
Alicia Jo Rabins Alicia Jo Rabins is a performer, musician, singer, composer, poet, writer, and Jewish scholar. She lives in Portland, Oregon, in the United States. Her use of language and words is central to her work: "Words may be the closest we get to immortal ...
and directed by Alicia J. Rose, tells the story of Madoff and the system that allowed him to function for decades through the eyes of Rabins, who watches the financial crash from her 9th floor studio in an abandoned office building on Wall Street.


See also

*
Allen Stanford Robert Allen Stanford (born March 24, 1950) is an American financial fraudster, former financier, and sponsor of professional sports. He is serving a 110-year federal prison sentence, having been convicted in 2012 of fraud, on charges that his i ...
*
Financial crisis of 2007–2008 Finance is the study and discipline of money, currency and capital assets. It is related to, but not synonymous with economics, the study of production, distribution, and consumption of money, assets, goods and services (the discipline of fi ...
*
List of investors in Bernard L. Madoff Investment Securities Investors in Bernard L. Madoff Investment Securities LLC lost billions of dollars in the Madoff investment scandal, a Ponzi scheme fraud conducted by Bernard Madoff. The amount missing from client accounts, over two thirds of which were fabricated ...
* Madoff investment scandal *
Participants in the Madoff investment scandal Participants in the Madoff investment scandal included employees of Bernard Madoff's investment firm with specific knowledge of the Ponzi scheme, a three-person accounting firm that assembled his reports, and a network of feeder funds that inves ...
* Recovery of funds from the Madoff investment scandal * White-collar crime * A Kaddish for Bernie Madoff: The Film


References


External links

* *
The Independent: Madoff reveals his suffering


{{DEFAULTSORT:Madoff, Bernie 1938 births 2021 deaths 2008 in economics 20th-century American businesspeople 21st-century American businesspeople 21st-century American criminals American male criminals American businesspeople convicted of crimes American chief executives of financial services companies American confidence tricksters American financial company founders American financiers American hedge fund managers American investment advisors American investors American money launderers American money managers American people convicted of fraud American people convicted of mail and wire fraud American people convicted of theft American people of Austrian-Jewish descent American people of Polish-Jewish descent American people of Romanian-Jewish descent American people who died in prison custody American perjurers American prisoners and detainees American stock traders American stockbrokers Brooklyn Law School alumni Businesspeople from Queens, New York Criminals from New York City Deaths from coronary artery disease Deaths from hypertension Deaths from kidney failure Far Rockaway High School alumni Financial scandals Former billionaires Hasidic Judaism Hofstra University alumni Jewish American philanthropists Madoff family Nasdaq People associated with the Madoff investment scandal People convicted of making false statements People from Queens, New York People from Roslyn, New York People from the Upper East Side Philanthropists from New York (state) Prisoners who died in United States federal government detention Pyramid and Ponzi schemes Stock and commodity market managers University of Alabama alumni Prisoners sentenced to life imprisonment by the United States federal government