NEW YORK (AP) – Bernard Madoff, the infamous architect of an epic securities scam that burned thousands of investors, beat regulators and was sentenced to 150 years in prison, died Wednesday in the federal prison. He was 82 years old.
Madoff’s death at Butner’s Federal Medical Center in North Carolina was confirmed by his attorney and the Bureau of Prisons.
Last year, Madoff’s lawyers filed court documents to try to release him from prison in the coronavirus pandemic, saying he had suffered end-stage kidney disease and other chronic medical conditions. The request was denied.
His death was due to natural causes, a person familiar with the matter told The Associated Press. The person was not allowed to speak publicly and spoke to the AP on condition of anonymity.
For decades, Madoff enjoyed an image as a self-made financial guru Midas ’touch challenged market fluctuations. Former president of the Nasdaq stock market, he attracted a devoted legion of investing clients, from Florida retirees to celebrities like famed film director Steven Spielberg, actor Kevin Bacon and Hall of Fame pitcher Sandy Koufax .
But his investment advisory business was exposed in 2008 as a Ponzi scheme that ended people’s fortunes and ruined charities and foundations. He became so hated that he had to wear a bulletproof vest in court.
Fraud was believed to be the most important thing in Wall Street history.
Over the years, court-appointed trustees working to develop the scheme have recovered more than $ 14 billion from the $ 17.5 billion that investors spent on Madoff’s business. At the time of Madoff’s arrest, false account statements told customers they had $ 60 billion worth of stakes.
Madoff pleaded guilty in March 2009 to fraud in securities and other charges, saying he was “deeply sorry and ashamed.”
After several months living under house arrest in his $ 7 million Manhattan penthouse, he was taken to jail handcuffed by scattered applause from angry investors in the room.
“He stole from the rich. He stole from the poor. He stole from the middle. He had no values, “former Judge Tom Fitzmaurice told the judge at sentencing.” He tricked his victims with his money so that he and his wife … could live a life of luxury out of belief. “
Madoff’s lawyer in recent years, Brandon Sample, said in a statement that the financier had “lived with guilt and remorse for his crimes” until his death.
“Although the crimes for which Bernie was convicted have come to define who he was, he was also a father and husband. He was soft-spoken and intellectual. Bernie was far from perfect. But no man is.” dir Sample.
U.S. District Judge Denny Chin convicted Madoff as soon as possible.
“Here is the message that Mr. Madoff’s crimes were extraordinarily bad and that this kind of irresponsible manipulation of the system is not just a bloodless financial crime that occurs only on paper, but it is what it is. .. an amazing human toll, ”Chin said.
A judge issued a confiscation order in June 2009 to remove Madoff from all of his personal property, including real estate, investments and $ 80 million in assets that his wife, Ruth, had claimed were his. The order left him $ 2.5 million.
The scandal also caused a personal toll on the family: one of his children, Mark, committed suicide on the second anniversary of his father’s arrest in 2010. And Madoff’s brother, Peter, who helped run the business, was sentenced to 10 years in prison. in 2012, despite claiming he was in the dark about his brother’s misdeeds.
Madoff’s other son, Andrew, died of cancer at age 48. Ruth is still alive.
Madoff was sent to do what was tantamount to life imprisonment at the Butner Federal Correctional Complex, about 45 miles northwest of Raleigh, North Carolina. A federal prison website indicated his probable release date on November 11, 2139.
Madoff was born in 1938 in a lower-middle-class Jewish neighborhood in Queens. In the financial world, the story of his rise to prominence (how he left Wall Street with Peter in 1960 with a few thousand dollars saved to work as a lifeguard and install sprinklers) became legendary.
“They were two children from Queens with difficulties. They worked hard, ”said Thomas Morling, who worked closely with the Madoff brothers in the mid-1980s in setting up and running computers that made his company a trusted leader in off-floor trade.
“When Peter or Bernie said something they would do, their word was their bond,” Morling said in a 2008 interview.
In the 1980s, Bernard L. Madoff Investment Securities occupied three floors of a tall building in midtown Manhattan. There, with his brother and later two children, he ran a legitimate business of intermediary between buyers and sellers of shares.
Madoff raised his profile using experience to help launch Nasdaq, the first electronic stock exchange, and became so respected that he advised the Securities and Exchange Commission on the system. But what the SEC never found out was that, behind the scenes, in a locked-in independent office, Madoff was secretly spinning a network of ghost wealth using money from new investors to pay returns to old ones.
Authorities say at least $ 13 billion was invested over the years with Madoff. An old IBM computer published monthly excerpts showing constant double-digit yields, even during market recessions. At the end of 2008, statements stated that investor accounts amounted to $ 65 billion.
The ugly truth: titles were never bought or sold. Madoff chief financial officer Frank DiPascali said in a 2009 guilty statement that the statements detailing the trades were “all false.”
His clients, many Jews like Madoff and Jewish charities, said they didn’t know it. Among them was Nobel Peace Prize winner and Holocaust survivor Elie Wiesel, who recalled meeting Madoff years earlier at a dinner where they talked about Jewish history, education, and philosophy. of money.
Madoff “made a good impression,” Wiesel said during a 2009 roundtable on the scandal. Wiesel admitted that he bought “a myth that he created around him that everything was so special, so unique that it had to be secret.”
Like many of his clients, Madoff and his wife enjoyed a lavish lifestyle. They had a $ 7 million apartment in Manhattan, a $ 11 million estate in Palm Beach, Florida and a $ 4 million house on the tip of Long Island. There was yet another house in the south of France, private jets and a yacht.
It all crashed in the winter of 2008 with a dramatic confession in Madoff’s 12th-floor apartment on the Upper East Side. In a meeting with his children, he confided that his business was “just a big lie.”
After the meeting, a family lawyer contacted regulators, who alerted federal prosecutors and the FBI. Madoff was wearing a bathrobe when two FBI agents arrived at his door without warning one December morning. He invited them in and then confessed after asking him “if there is an innocent explanation,” a criminal complaint said.
Madoff replied, “There is no innocent explanation.”
As he did from the beginning, Madoff insisted on his plea that he act alone, something the FBI never believed. When agents explored evidence records of a larger conspiracy and cultivated DiPascali as a cooperator, the scandal turned Madoff into an outcast, evaporated life fortunes, wiped out charities, and apparently pushed some investors to commit suicide.
An administrator was appointed to recover funds (sometimes demanding hedge funds and other large investors coming forward) and handing out this product to the victims. Madoff’s pursuit of assets “has unearthed a maze of interrelated international funds, institutions, and entities of almost unmatched complexity and breadth,” trustee Irving Picard said in a 2009 report.
The report states that the trustee has located assets and businesses “of interest” in 11 locations: Britain, Ireland, France, Luxembourg, Switzerland, Spain, Gibraltar, Bermuda, the British Virgin Islands, the Cayman Islands and the Bahamas. More than 15,400 claims were filed against Madoff.
At Madoff’s sentencing in June 2009, angry former clients showed up to demand maximum punishment. Madoff himself spoke monotonously for about 10 minutes. At various times, he referred to his monumental fraud as a “problem”, “an error of judgment” and “a tragic error”.
He claimed he and his wife were tormented, saying she “cries to sleep every night, knowing all the pain and suffering I have caused.”
“I live with that too,” he said.
Then Ruth Madoff, often the target of the victims’ contempt since her husband’s arrest, broke her silence that same day by issuing a statement stating that she too had been deceived by her high school love.
“I’m embarrassed and embarrassed,” she said. “Like everyone else, I feel betrayed and confused. The man who committed this horrible fraud is not the man I know all these years.
About a dozen Madoff employees and associates were charged in the federal case. Five went to trial in late 2013 and saw DiPascali take the witness stand as the government’s star witness.
DiPascali explained to jurors that just before the plan was exposed, Madoff called him to his office.
“I had been staring out the window all day,” DiPascali said. “He turned to me and said shouting,‘ I’m at the end of the rope. … Don’t you understand? Everything damn is a scam.
In the end, that fraud brought new meaning to the “Ponzi scheme,” which bears the name of Charles Ponzi, who was convicted of mail fraud after killing thousands of people for $ 10 million between 1919 and 1920. .
“Charles Ponzi is now a footnote,” said Anthony Sabino, a defense attorney specializing in white-collar criminal defense. “Now they’re Madoff schemes.”