BERNIE MADOFF DIES
NEW YORK – Bernard Madoff, the infamous architect of an epic securities swindle that burned thousands of investors, outfoxed regulators and earned him a 150-year prison term, died Wednesday. He was 82.
Madoff ’s death at the Federal Medical Center in Butner, North Carolina, was confirmed by his lawyer and the Bureau of Prisons.
Last year, Madoff ’s lawyers unsuccessfully asked a court to release him from prison during the coronavirus pandemic, saying he suffered from end-stage renal disease and other chronic medical conditions.
His death was due to natural causes, said a person familiar with the matter who was not authorized to speak publicly.
For decades, Madoff enjoyed an image as a self-made financial guru whose Midas touch defied market fluctuations. A former chairman of the Nasdaq stock market, he attracted a devoted legion of investment clients, from Florida retirees to celebrities such as 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 wiped out people’s fortunes and ruined charities. He became so hated he wore a bulletproof vest to court. The fraud was believed to be the largest in Wall Street’s history.
Over the years, court-appointed trustees laboring to unwind the scheme have recovered more than $14 billion of an estimated $17.5 billion investors put into Madoff ’s business. At the time of Madoff ’s arrest, fake account statements were telling clients they had holdings worth $60 billion.
Madoff pleaded guilty in March 2009 to securities fraud and other charges, saying he was “deeply sorry and ashamed.”
After several months living under house arrest at his $7 million Manhattan penthouse apartment, he was led off to jail in handcuffs to scattered applause from angry investors in the courtroom.
A judge issued a forfeiture order stripping Madoff of all his personal property, including real estate, investments, and $80 million in assets his wife, Ruth, had claimed were hers. The order left her with $2.5 million.
“He stole from the rich. He stole from the poor. He stole from the in between. He had no values,” former investor Tom Fitzmaurice told the judge at the sentencing. “He cheated his victims out of their money so he and his wife ... could live a life of luxury beyond belief.”
Brandon Sample, Madoff’s attorney in recent years, said in a statement that the financier had “lived with guilt and remorse for his crimes” up until his death.
In the 1980s, Bernard L. Madoff Investment Securities occupied three floors of a midtown Manhattan highrise. There, with his brother and later two sons, he ran a legitimate business as middlemen between the buyers and sellers of stock.
Madoff raised his profile by using the expertise 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 separate office kept under lock and key, Madoff was secretly spinning a web of phantom wealth by using cash from new investors to pay returns to old ones.
An old IBM computer cranked out monthly statements showing steady double-digit returns, even during market downturns. As of late 2008, the statements claimed investor accounts totaled $65 billion.
The ugly truth: No securities were ever bought or sold. Madoff ’s chief financial officer, Frank DiPascali, said in a guilty plea in 2009 that the statements detailing trades were “all fake.”
Like many of his clients, Madoff and his wife enjoyed a lavish lifestyle. They had the Manhattan apartment, an $11 million estate in Palm Beach, Florida, and a $4 million home on the tip of Long Island.
It all came crashing down in the winter of 2008 with a dramatic confession. In a meeting with his sons, he confided his business was “all just one big lie.”