|Madoff To Be Free in July, 2159|
Ponzi schemer gets maximum sentence.
Bye bye, Bernie.
A Federal judge sentenced rip-off artist Bernie Madoff to 150 years in prison, the maximum term.
For Madoff, 71, it means that his life comes down to a prison cell. Tough luck, pal.
“Here the message must be sent that Mr. Madoff’s crimes were extraordinarily evil and that this kind of manipulation of the system is just not a bloodless crime that takes place on paper, but one instead that takes a staggering toll,” US District Judge Denny Chin said at Madoff’s sentencing hearing. “…The fraud here was staggering.”
In prior fraud cases, Worldcom’s Bernie Ebbers was sentenced to 25 years in prison, Bayou Hedge Fund’s Sam Israel got 20 years, and Refco’s Phillip Bennett received 16 years.
In Madoff’s case, the prosecutor recommended 150 years and the defense suggested 12 years. If the judge had followed the defense attorney’s recommendation, Madoff could have been released from prison in about 9 years.
Madoff’s Ponzi scheme totaled about $65 billion. The case grew into a global fraud that involved hedge funds, charities, and celebrities. He bamboozled thousands of individual investors, including US Democratic Senator Frank Lautenberg of New Jersey, former Dodgers pitcher and Hall of Famer Sandy Koufax, and a charity run by Nobel Peace Prize winner Elie Wiesel.
About 200 investors have received legal requests to return money they withdrew from Madoff’s funds before the scheme collapsed, including the Royal Bank of Scotland (RBS), Societe General (GLE), HSBC (HBC), and 2 hedge funds run by Banco Santander (STD), a Spanish concern.
Such “clawback” requests are routine. The withdrawals were paid as part of a scam, the legal theory goes, and therefore should be returned and divided proportionately among those who were defrauded.
There’s now about $1.25 billion available to compensate the victims of Madoff’s fraud.
Irving Picard of the Baker-Hostetler law firm has been handling the Madoff liquidation. He says in court filings that the funds “were not complicit in the fraud” and “did not have any actual knowledge of the fraud,” the New York Times reports.
Linda Thomsen, the Securities and Exchange Commission’s chief enforcement officer, stepped down days after Congress harshly criticized the federal agency for failing to detect Madoff’s scheme. Call it Bernie’s revenge -- another person's life and livelihood ruined.
SEC chairwoman Mary Schapiro says she wants to “beef up” her agency’s tarnished reputation. Here’s hoping Robert Khuzami -- a former federal prosecutor named to the post in February -- provides some much-needed adult supervision at the SEC.
Last week, a judge stripped Madoff of all his personal property, including real estate, investments, and $80 million claimed by his wife, Ruth Madoff. Last week, Mrs. Madoff agreed to sell her co-op apartment on Manhattan’s Upper East Side, valued at an estimated $7.5 million. The court’s action left her with about $2.5 million.
According to press reports, Mrs. Madoff now uses her maiden name, Alpern, and has been turned away by several co-ops because residents fear she'll draw incessant press attention. Madoff’s sons have denied all knowledge of the scheme.
If there’s a brighter side to Madoff’s fraud, this is it: Bernie turned swindling into an art form -- so it stands to reason that a New York sculptor would turn Bernie into art.
Palmer Murphy made a fake bronze bust of Madoff that doubles as a piggybank. The catch: you drop money through the slot in the top of Bernie’s noggin, but you never see it again because the plug at the bottom is fake. Call it “the gift that keeps on taking.”
Madoff showed no emotion as his victims testified at the court hearing.
“Life has been a living hell,” victim Carla Hirschhorn said. “It feels like a nightmare we can’t awake from.”
No positions in stocks mentioned.
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