Are you guys keeping tabs of the philanthropical foundations that are closing because of Madoff?

[The Backlash Cometh]

Guys, this is serious shit. The first to go are foundations that have to do with education and research. Take some time to read the articles below. Keep in mind that the asshat Republicans were pushing us to depend on privatizing for everything, which is why they wanted us to do away with the Social Security Funds. I want you all on DU to take a bow, because the little we have we owe to the voices who opposed the Republicans on this issue. We would all be incredibly more fucked than we are today if not for our dissenting voices.



Foundation that supported biomedical research to close, victim of alleged Madoff fraud scheme

NEW YORK (AP) — One of the nation's leading educational philanthropies announced that it would close in the coming months, brought down by the alleged financial fraud orchestrated by Bernard Madoff.

Barbara Picower, who along with her husband, Jeffry, established the Picower Foundation in 1989, said in a statement on Friday that the foundation's grant-making would cease "effective immediately" and that it would "close its doors in the coming months."

She wrote in the statement that Madoff's "act of fraud has had a devastating impact on tens and thousands of lives as well as numerous philanthropic foundations and nonprofit organization."

Madoff is accused of swindling investors of $50 billion in a massive Ponzi scheme. He was ordered on Friday to remain in his Manhattan home under 24-hour surveillance and to hire security guards for protection.

http://www.orlandosentinel.com/news/nationworld/sns-ap-madoff-scandal-charities,0,6185057.story



Madoff Scandal Forces JEHT Foundation’s Closure

More victims of Bernard L. Madoff Investment Securities continue to emerge on Monday. The JEHT Foundation, a charity that supports reform of the criminal and juvenile justice systems, said that it would stop making grants and close its doors next month because its donors, Jeanne Levy-Church and Kenneth Levy-Church, were investors in the Madoff firm.

The foundation was established in 2000 and worked mainly through grants to other non-profits whose missions included voter registration, government transparency and ensuring the U.S. adhered to the international rule of la

http://dealbook.blogs.nytimes.com/2008/12/15/madoff-scandal-forces-jeht-foundations-closure/



Madoff losses ripple into Boston, shut foundation

BOSTON (Reuters) - The alleged $50 billion fraud by former Nasdaq Chairman Bernard Madoff has rippled deep into Boston's wealthy elite, forcing a charitable foundation to close and triggering losses by prominent philanthropists.

The Robert I. Lappin Charitable Foundation, which financed trips for Jewish youth to Israel, said the money that supported its programs was invested with Madoff, a 70-year-old Wall Street trader arrested on Thursday.

"The money needed to fund the programs of the Lappin Foundation is gone," the Salem, Massachusetts-based foundation said on its website, adding all staff had been let go.

"It is with a heavy heart that I make this announcement," Robert I. Lappin, the foundation's trustee, said in a statement.

http://www.reuters.com/article/topNews/idUSTRE4BC1WK20081215



Steven Spielberg among victims of Madoff scam: reports

LOS ANGELES (AFP) – Steven Spielberg's charitable foundation fell victim to the mammoth 50-billion-dollar fraud allegedly carried out by Wall Street heavyweight Bernard Madoff, reports said.

It is not known if the Oscar-winning film-maker had chunks of his personal fortune invested with Madoff but the director's Wunderkinder Foundation has suffered losses, according to the Wall Street Journal.

The foundation could not be immediately contacted for comment.

The newspaper reported that about 70 percent of the dividend income and interest for the foundation had been handled by Madoff's securities firm, which is now the subject of one of the biggest fraud investigations in history.

http://news.yahoo.com/s/afp/20081216/en_afp/usfinancefraudspielberg


Lautenberg foundation hit by Madoff scheme

Forms filed with the IRS in 2007 show Lautenberg’s charitable foundation had significant assets invested with Madoff Investment Securities, money that is now as good as gone.

As of the end of the 2006 calendar year, the Lautenberg Foundation had nearly $12.8 million invested with Madoff, along with just over $1 million in other assets.

The same year, the foundation handed out more than $765,000 to charities across the country. Over the years, Lautenberg has directed millions of dollars to organizations like the Breast Cancer Research Foundation, Catholic Relief Services and the NAACP.

Scott Mulhauser, a senior advisor to Lautenberg, would not comment on the loss except to confirm that it had occurred.

http://thehill.com/leading-the-news/lautenberg-foundation-hit-by-madoff-scheme-2008-12-16.html

[Christian30]

1. This is awful...

I'm a fundraiser and given how the market has already really hurt the assets of lots of foundations that fund our work. That this guy is responsible for these large foundations going under is only going to hurt nonprofits at a time when our services are really needed.

[The Backlash Cometh]

2. You got that right. We're going to see real rugged individualism taking place

in the future.

[JerseygirlCT]

17. Yes. And individual donations won't be able to pick up the slack.

More and more hurting, fewer resources to help - a scary downward spiral.

[SammyWinstonJack]

3. K&R!

[The Backlash Cometh]

4. Here's an informative article on how it has affected the Jewish philanthropical community:

Madoff scheme hits Jewish charities hard

Madoff was a member of the exclusive Palm Beach Country Club, and he recruited many investors from its ranks. One of the interesting things about the club is that members are required to not only have money, but to make hefty annual contributions to charity, perhaps even hundreds of thousands of dollars.

"There is, in fact, such a requirement," a member who lost money to Madoff confirmed to The Associated Press in a telephone interview. The member spoke on condition of anonymity because he wasn't ready to speak publicly about his losses. "It's an unusual requirement."

To Sarna, the Brandeis professor, that rule speaks volumes about the importance of charity in Jewish circles.

"It's a statement that you're a responsible member of the Jewish community," Sarna said. "It's very much in the value system."

To be betrayed by one of their own in the very act of giving has been all the more devastating to these investors, Sarna noted. "What they were doing was intrinsically good, and then they see all of that good rewarded by wickedness," he said.

http://www.rcjf.org/page.aspx?id=189928

[The Backlash Cometh]

5. Another link:

MADOFF $CAM IS BAD 'NEWS'
PAPER'S OWNER MORT TAKES A BIG HIT


Daily News owner and real-estate mogul Mort Zuckerman is one of the investors ripped off by swindler Bernard Madoff, it was reported today.

Zuckerman, who also owns US News & World Report, has "significant exposure" through a fund that invested virtually all of its assets with Madoff, The Wall Street Journal says, quoting a person familiar with his investments.

http://www.nypost.com/seven/12152008/news/worldnews/madoff_cam_is_bad_news_144297.htm

[NashVegas]

19. At Least There's One Bright Spot

[The Backlash Cometh]

6. Also the Olympic Committee

IOC has nearly $5 million tied to Madoff

LONDON - The International Olympic Committee could lose nearly $5 million in investments tied to the Wall Street financier accused in a $50 billion financial scam.

IOC finance commission chairman Richard Carrion told The Associated Press the Olympic body has about $4.8 million at risk in the alleged Ponzi scheme by Bernard Madoff.

"That could be the maximum loss," Carrion told The Associated Press in a telephone interview from Puerto Rico, adding that the IOC's money wasn't directly in Madoff funds. "They're in funds invested in Madoff funds."

IOC spokeswoman Emmanuelle Moreau said the Madoff affair would have "limited impact" on the IOC's overall finances.

http://enews.earthlink.net/article/nat?guid=20081220/494c7bd0_3ca6_1552620081220230364761

[The Backlash Cometh]

7. Interesting quote. Shame that the one group who still believed in noblesse oblige,

were the ones that got stung.

Tentacles of Madoff scandal reach far and wide

It's a strange paradox, Schwartz and others in his situation say. All the attention swirling around Madoff has been about his wealthy lifestyle and the ultra-rich investors in places like Palm Beach and Hollywood and New York who lost their shirts. But few seem to understand the repercussions.

"It's very ironic that the very wealthiest in the country can have such a severe impact on kids on the low end of the totem pole," said Mark Steward, whose Missouri Youth Services Institute has relied on funding from the Levy family to help improve juvenile detention centers in Santa Clara County, California, Washington, D.C. and elsewhere.

If only Madoff knew, Steward mused - "Or maybe he does know."

"Sometimes, they just don't care."

http://enews.earthlink.net/article/top?guid=20081220/494c7bd0_3ca6_15526200812201390277292

[Duer 157099]

8. I haven't really followed this story, but where has the money gone?

In a ponzi scheme, somebody wins, and wins big. Who won this time? Where is all that money?

[The Backlash Cometh]

9. Great timing. I found this article, but first:

In a Ponzi scheme, the money that comes in from new investors, goes to the old investors. So the earlier you invest the better chance you have of getting your money back. Like a chain letter concept. So his older accounts did the best. Some names have already been mentioned prominently. Carl and Ruth Shapiro, for instance, but keep in account that they have also been ripped off. You see, he went after people who already had money. They had to produce millions of dollars to get in.

However, I think these following paragraphs will give you an idea where they're looking next, to answer your question:

Victims of the Fall of Madoff

INVESTIGATORS poring over Madoff’s books last week found thousands of clients whose accounts were detailed in seven binders. The holdings of these clients were with “clearing banks”, according to the documents. So far the SEC has been unable to identify any such banks. It appears that Madoff had at least two sets of books and there may possibly be no true record of where all the money has gone.

“We are concerned that many, or possibly all, of these positions do not exist,” the SEC wrote in an initial report.

So far Madoff has said he acted alone, a story financial experts find hard to swallow. “Are you telling me that nobody at this firm had the slightest idea what was going on? Money comes in, money goes out and nobody saw anything?” said Jim Cox, law professor at Duke University.

He said he found it “highly unlikely” that one man could pull off a $50 billion fraud. “If we were talking about $100,000, yes, but $50 billion, no. He’s a talented person but he doesn’t have the talent to do that,” said Cox.

Madoff’s family are all likely to come under scrutiny. This was very much a family business. His wife Ruth entertained clients at their three luxury homes and at the six golf clubs of which they were members.

New York investigators are also keen to find out exactly how much Madoff’s sons knew. Mark, 44, and Andrew, 42, have worked at the firm since their twenties. They have not been allowed to see or speak to their father since they brought in the authorities after his confession. A lawyer for the brothers has stated they had no knowledge of any alleged fraud before their father’s shocking revelation at a family meeting. The sons refused to put up bail.

Madoff’s brother Peter was the chief compliance officer. Shana Madoff, his niece, was the firm’s compliance attorney. Embarrassingly for the regulators, Shana is married to a former SEC officer, Eric Swanson. Swanson was the agency’s assistant director in the office of compliance inspections and examinations.

http://business.timesonline.co.uk/tol/business/industry_sectors/banking_and_finance/article5375376.ece

[psychmommy]

10. whether they knew anything or not they all profited from it.

this is a sin and a shame. not just the rich were effected by this. there are alot of hurting people. dude should be in jail awaiting trial-not house arrest.

[intheflow]

21. I don't understand why all his assets haven't been seized and

the family (or at least the wife) thrown out of all of their three homes. I mean, some schmuck growing five pot plants in his basement that might net him $5000 in profit will have his home seized, but this asshole only has his assets frozen?
:wtf:


Glad to see his sons refused to put up bail, though. He must have been a hellova dad. :eyes:

[LiberalHeart]

22. I'm with you on that. He's free because he owns homes bought with stolen dough.

[The Backlash Cometh]

24. Maybe he has tales he can tell.

He's been doing this for at least twenty years. Someone must have known and looked the other way.

[The Backlash Cometh]

11. From that last article I posted, it looks like he was well on his way

to being a Ponzi player by 1995, but not before 1980. I make the assessment because one of his oldest clients said he produced the right kind of reports prior to 1980. But in 1995, when she asked for copies of financial statements, he got angry and told her she needed to close her account if she insisted on getting the paperwork. She closed her account.

By 1999, someone was onto him and that person waited until 2005 to follow-up his suspicions with good paperwork. That means that the authorities have been lagging for at least the entire Bush Administration era. It didn't hurt that one of Madoff's family members has contact with the SEC:

Mass. Investor saw inside Madoff Scam

By 1999, he was working for Rampart Investment Management Co. and charged with doing competitive research on Bernard L. Madoff Investment Securities, which was using a similar investment strategy as his company, but far outperforming it. Part of Markopolos's research included a visit to diBartolomeo, whom he knew from his professional circle.

"I think he was curious about how his competitor was doing so much better than they were," diBartolomeo recalled.

Researching Madoff's numbers, using data the firm distributed to prospective investors, diBartolomeo concluded within hours that it was impossible for Madoff to get the returns he reported while using the strategy he said he used.

"As the market goes up and down, this strategy should have done a little better or a little worse, just like everybody else," he said. "Instead, it appeared to be indifferent as to whether the market went up or down. They made money all the time."

Markopolos complained to the SEC's Boston office in May 1999, saying it was impossible for the kind of profit Madoff was reporting to have been gained legally.

But Madoff continued to thrive, even as Markopolos continued to pursue the case.

In 2005, he submitted a report to the SEC saying it was "highly likely" that "Madoff Securities is the world's largest Ponzi scheme." In the report, he says he knew his research could ruin people's careers and asked the SEC be discreet about circulating the report and his name.

"I am worried about the personal safety of myself and my family," he wrote.

http://news.yahoo.com/s/ap/20081219/ap_on_bi_ge/madoff_scandal_whistleblower

[The Backlash Cometh]

12. Mary Schapiro: The woman Obama picked to clean up the mess:

Obama picks Mary Schapiro to head Securities and Exchange Commission

http://www.latimes.com/business/la-fi-schapiro18-2008dec18,0,7352633.story

[depakid]

13. What's so strange about this whole deal is that so many were taken in

by what now seems like such a preposterous scam. How could anyone with knowledge of the workings of these sorts of funds have not seen (or ignored) the repeated red flags?

I can understand "regulators" refusing to act (over the past 15 years- ANYTHING is possible in that regard)- but so many sophisitcated professionals acting essentially on faith?

:shrug:

[The Backlash Cometh]

15. Well, I think it tells you something about the rich. They are a very

exclusive club. You get in and say the right things (remember, it wasn't just about making money, it was about doing charitable work) and people just trust you. Everything is based on relationships.

[JerseygirlCT]

18. IIRC from what I've been hearing and reading

in many cases the foundations had no idea they were invested in his scheme. They were invested in funds that were by all accounts, totally respectable. These funds were then invested with Madoff.

The other part of it of course is that when you're making great gains, you're often less likely to look too closely.

[depakid]

20. These were the so called "feeder funds"

Not sure how far the duty to perform due dilligence goes, but one would think that the investment managers would want to see what the "feeder funds" were invested in- and what potential exposure(s) they had. After all, we're talking about trust accounts that are required to be ivested with minimal risk to the underlying principle.

On the second point, David Sarasohn had a fine comment on that the other day:

What's revealed when the market recedes

...For decades, Madoff has run his own revered investment fund, producing regular returns and winning the trust -- and the money -- of large numbers of very wealthy families, philanthropic agencies and major financial institutions. He produced regular returns, and always had the money for anyone seeking a withdrawal. Wealthy figures begged their friends for introductions to Madoff, who served at one point as the head of the NASDAQ exchange.

Now it's all collapsed, and Madoff has admitted to his sons that he was running a massive Ponzi scheme, using new investors' money to pay off old investors, and now coming up as much as $50 billion short. His investors, many of them sophisticated individuals and institutions, are badly hurt and in some cases ruined.

That should be enough, or more than enough. But it may suggest something else.

Cons, after all, are easier to pull off when things are good, when there's plenty of money around -- including new money to pay off old investors -- and nobody's asking too many questions. The New York Times on Monday cited John Kenneth Galbraith's principle that when the financial waters recede, they reveal not only bad calculations and overextended positions, but actual embezzlements -- what he called the "bezzle." Madoff's is the first, but perhaps not the last.

Moreover, as Peter Hahn, a fellow in finance at London's Cass Business School, told Reuters, "A frothy market encourages slack oversight."

After all, who wants to ask questions when everyone's making money?

http://www.oregonlive.com/news/oregonian/david_sarasohn/index.ssf/2008/12/whats_revealed_when_the_market.html

Or, as the Grateful Dead put it "when life seems like easy street, there is danger at your door...."

[SoCalDem]

23. The farther away from your money you get, the riskier

This is one reason why so many who lived through the depression, never really ever trusted banks or investment schemes again..and why so many of them preferred to eschew the "interest" they might make, and instead BOUGHT things.. tangible things ...like land, art, machinery..educations for their kids & grandkids..

For massive frauds like this to occur, there has to be a lot of time passage from the last big scam..We are getting more gullible though..

S&L was just 20 years ago..dot.com was about 10..Enron was only 7 years..and here we go again:(

[entanglement]

28. It was an ethnic affinity scam - which is why most of the primary investors who got ripped off were

Jews. They made investment decisions based partly on ethnicity and got burnt.

[mile18blister]

14. K & R

:kick:

[earth mom]

16. K & R. nt

[NYC]

25. You requested

this kick in another thread. Happy to oblige.

[The Backlash Cometh]

26. Thanks!

I think this one is so big that it was difficult for people to grasp in the beginning, but, it looks like people are "getting it."

[mucifer]

27. They need to put those SEC investigators in jail too.