How much is Bernard Madoff worth?

Net Worth:-$17 Billion
Profession:Professional Market Maker
Date of Birth:April 29, 1938
Country:United States of America
Height:
1.71 m

Who Is Bernard Madoff

Bernard Madoff (Bernie) is a former Chairman of the NASDAQ stock exchange who started his own investment advisory firm. He pled guilty to defrauding investors in the amount of over $50 billion by running the largest Ponzi scheme on record over at least two decades.

American former market maker, investment advisor, financier and convicted fraudster Bernard Madoff has a net worth of -$17 billion dollars, as of 2020. The convicted swindler Bernard Madoff owned net assets of at least $823 million as of the close of 2008, court records shows.

Bernard Lawrence Madoff: April 29, 1938 in Queens, New York.

What did Bernard Madoff do?

In early December 2008, during the economic meltdown in the United States, Madoff could no longer honor his investors cash requests. He finally had to come clean and admit what he had been doing. When he admitted to this Ponzi scheme, Wall Street and the world was knocked back on its heels. It was a massive investment fraud that had affected many people including high profile investors.

Who did Madoff defraud?

Madoff had such a good reputation in the financial community that many of his investor had their life savings invested with him. Some of Madoff’s investors included a charitable organization funded by Steven Spielberg, actor Kevin Bacon, the owners of the New York Mets, and others. Large banks and pension funds were scammed by Madoff. Examples include Banco Santander, a Spanish bank; HSBC, a Britsh bank; Royal Bank of Scotland; and Korea Teachers Pension. Some of Madoff’s individual investors are actually out on the street, living out of cars and RV’s. The Wall Street Journal developed a list of all Madoff’s victims.

What happened to Madoff and the Money?

Bernard Madoff pled guilty to the charge of securities fraud among others and was sentenced to 150 years in a maximum security prison. He is currently serving his time. The courts are currently sorting through Madoff’s financial records and have been since his arrest. They are trying to decide how to pay off his investors with the money they can find and which ones should be paid off. Madoff says, from prison, that the big banks defrauded in his scheme were complicit.

What About Madoff’s Family?

Madoff’s two sons, Mark and Andrew, both worked in his firm but on a side of the business that was not directly connected to the Ponzi scheme Madoff was running. Both, however, have been named in lawsuits and were under investigation, but they didn’t face any criminal charges with regard to the $50 billion Ponzi scheme.

Two years to the day after Madoff was arrested for running a Ponzi scheme, his son, Mark Madoff, committed suicide in his New York City apartment building. He did not leave a suicide note, but both brothers were very bitter toward their father and had not spoken to their father or mother in two years.

Ruth Madoff, Bernard’s wife, quit seeing Madoff in prison in order to reconcile with her son, Andrew. She settled with the feds for $2.5 million. She revealed that she and Bernie made a suicide pact before he revealed his Ponzi scheme but didn’t go through with it.

Andrew Madoff’s fiancee, Catherine Hooper, has written a book in cooperation with Laurie Sandell, called Truth and Consequences: Life in the Madoff Family. Andrew and Ruth Madoff will not profit from the book but Andrew’s fiancee will. Many victims of the Madoff Ponzi scheme are angry about this and feel the profits should go to compensate victims.

After Madoff’s Ponzi scheme was uncovered, other Ponzi schemes were also uncovered, but none even approaching the size of the Ponzi scheme Bernard Madoff was running.

Many Celebrities Were Madoff Investors

Investors included New York Mets owner Fred Wilpon, GMAC Chairman J. Ezra Merkin and former Philadelphia Eagles owner Norman Braman. Also losing substantial sums were real-estate magnate Mortimer Zuckerman, the foundation of Nobel laureate Elie Wiesel, and a charity of movie director Steven Spielberg. Some investors had as much as $11 million, which represented 95% of their total net worth. Banks with money invested included French bank BNP Paribas, Tokyo-based Nomura Holdings and Neue Privat Bank in Zurich. Hedge fund Maxam Capital Management lost $280 million and will have to close.

Did the SIPC Cover Madoff Losses?

The Securities Investor Protection Corp. (SIPC) only covered those who invested through Madoff’s brokerage firm, not his investment advisory firm. The SIPC covers losses up to $500,000 that are related to theft and proven unauthorized trading, which could include a Ponzi scheme. However, the SIPC only has $1.5 billion, and would have to go back to Congress if it turns out

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it needed to cover the full $50 billion. SIPC doesn’t cover hedge funds and other investments not registered with the SEC. (Source: WSJ, Are Investors Safe from Fallout?, December 14, 2008; Fund Fraud Hits Big Names, December 13, 2008 )

Ruth and Bernard Madoff Marriage

After being married for nearly 50 years and developing a successful partnership, Ruth and Bernard Madoff face both the legal consequences and the victims of Bernard’s $65 billion Ponzi scheme. Bernard was sentenced to serve 150 years in federal prison.

Although not accused of doing anything wrong, Ruth had to forfeit all assets except $2.5 million.

How Bernard and Ruth Met:

Bernard and Ruth met while students at Far Rockaway High School in New York. Bernard graduated in 1956 and Ruth graduated in 1958.

Wedding Date:

Ruth and Bernard were married on November 28, 1959 at the Laurelton Jewish Center.

Mark Seal: “Their wedding was described as a “very nice Jewish wedding-sit-down dinner …”
Source (includes photo of Bernie and Ruth Madoff): Mark Seal. “Madoff’s World.” VanityFair.com. 4/2009.

Children:

Ruth and Bernard have two sons. Their sons were the ones who alerted the federal investigators of the Ponzi scheme.

  • Mark Madoff: Born abt. 1964. Mark had four children. He committed suicide on 12/11/2010 at the age of 46.
  • Andrew Madoff: Born abt. 1966. Andrew died at the age of 48 on September 4, 2014 at Sloan Kettering Hospital in New York City. He had mantle cell lymphoma. 

Mark Seal: “He [Bernie] loved his sons, but he never showed it,” said a family friend. “Mostly tough love and fear. People were afraid of Bernie. He wielded this influence. They were afraid of his temper.”
Source: Mark Seal. “Madoff’s World.”  VanityFair.com. 4/2009.

Occupations:

Bernard: Investment broker, investment adviser, owner of an investment-advisory business, Bernard L. Madoff investment Securities LLC.

“The owner’s name is on the door. Clients know that Bernard Madoff has a personal interest in maintaining the unblemished record of value, fair-dealing, and high ethical standards that has always been the firm’s hallmark.”
Source: Cached version of Madoff.com.

Ruth: Co-trustee of the Madoff Family Foundation, nutritionist, cookbook editor.

“From the start, Ruth’s office was right next to her husband’s.”
Source: Mark Seal. “Madoff’s World.” VanityFair.com. 4/2009.

Alice Leigh Cowan: “Karen MacNeil, a food and wine expert who was given the title of editor of the project, beneath the two executive editors —- Mrs. Madoff and her friend Idee Schoenheimer —- disclosed in an interview with The New York Times that she was paid to write the cookbook in its entirety.”
Source: Alison Leigh Cowan. “A Madoff Cookbook Has a Secret, Too.”  NYTimes.com 1/14/2009.

Residences:

Bernie Madoff is at the Metropolitan Corrections Center awaiting a decision as to which federal prison he will be assigned to for his 150-year sentence.

“Madoff is now in jail at the Metropolitan Corrections Center, very near the Federal courthouse building where he made his plea. And he is now known as inmate #61727054.”
Source: “Bernie Madoff’s New Digs: From Penthouse to Outhouse.”CNBC.com. 3/12/2009.

Before the Ponzi scheme investigation, Bernard and Ruth owned quite a few homes homes including ones in Montauk, New York, Roslyn, New York, the Upper East Side of Manhattan, a mansion in Palm Beach, Florida, and a home in France. These homes and other personal property were forfeited.

On July 2, 2009, three days after her husband Bernard Madoff was sentenced to 150 years in federal prison, Ruth Madoff was evicted from their $7 million penthouse in New York and surrendered personal property in the penthouse.

Joseph Kavanau: “… the first home Mr. Madoff shared with his bride was a modest, one-bedroom apartment in Bayside, Queens.”
Source: Julie Creswell, Landon Thomas Jr. “The Talented Mr. Madoff.”NYTimes.com. 1/24/2009.

Ruth Madoff, written statement: “I am embarrassed and ashamed. Like everyone else, I feel betrayed and confused. The man who committed this horrible fraud is not the man whom I have known for all these years.”
Source: Jack Healy. “Madoff Sentenced to 150 Years for Ponzi Scheme.” NYTimes.com. 6/29/2009.

Bernard Madoff at sentencing hearing: “How can you excuse lying to and deceiving your wife who still stands by you?”
Source: Aaron Smith. “Madoff sentenced to 150 years.” Money.cnn.com. 6/29/2009.

Eleanor Squillari: “Her [Ruth] apparent insecurity was surprising, but it was there, especially when it came to Bernie. She wanted to be perfect for him. She would never allow herself to gain weight or have a hair out of place, and she always kept an eagle eye on him, especially when he was around young, attractive women.”
Source: Mark Seal, Eleanor Squillari. “What the Secretary Saw.” VanityFair.com. June 2009.

Randy Cohen: “Marriage is a partnership. If you reap its rewards, you bear some responsibility for the way they accrue … She seems bright; she seems capable; she seems to have transferred millions of dollars just before his arrest. She was not entirely detached from his affairs.”
Source: Randy Cohen. “Ruth Madoff’s Duty” NYTimes.com. 4/28/09.

David Segal: “To friends, they were “Bernie-and-Ruth” or “Ruth-and-Bernie,” a pair so inseparable that you wouldn’t mention one without the other.

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After nearly 50 years of marriage, they worked in the same Midtown Manhattan office, they traveled together, and they dined together night after night, just the two of them … She wears a simple wedding band, rather than the oversize diamond that is the ring of choice among New York’s moneyed elite.”
Source: David Segal, Alison Leigh Cowan. “Madoffs Shared Much; Question Is How Much.” NYTimes.com 1/14/2009.

Rachel Silverman: “It’s hard to imagine being married to someone for decades and notknow what he was up to. As one childhood friend of Ruth’s and an investor in Madoff’s hedge fund told the Times: “All I will say on the subject is that it’s hard to imagine that she could live with the guy for 50 years and have no inkling.”
Source: Rachel Emma Silverman. “Madoff’s Marriage and the Secrets Between Spouses.” Wsj.com. 2/16/2009.

Douglas Feiden: “The girls among the 512-student Class of 1956 held little interest for Madoff because he had already met his future wife, the perky Ruth Alpern, from the Class of 1958.
Source: Douglas Feiden. “Bernie Madoff had a job saving lives, now he’s killed dreams.” NYDailyNews.com. 12/21/2008.

Ruth: “After college I married Bernie Madoff, FRHS class of ’55,'” she wrote in an update for the 50th reunion of the Far Rockaway High School in Queens. “Bernie and I worked together in the investment business he founded in 1960.”
Source: “Times Topics: Ruth Madoff.” NYTimes.com.

Julie Creswell: “He [Bernard] was, for instance, an avid collector of vintage watches and took time each morning to match his wedding ring — he owned at least two — to the platinum or gold watch band he was wearing that day.”
Source: Julie Creswell, Landon Thomas Jr. “The Talented Mr. Madoff.” NYTimes.com. 1/24/2009.

Diana Henriques: “With his wife, Ruth Madoff, a nutritionist and cookbook editor, they were considered affable and charming people. “They stood out,” Reisman said. “Success, philanthropy, esteem – and, if you were lucky enough to be with him as an investor, money.”
Source: Diana Henriques. “Vast Wall St. scheme knew no boundaries.” International Herald Tribune. 12/22/2008. pg 12.

Mark Seal: “According to one observer, Ruth allegedly did not allow her husband to travel alone for more than one day. “She didn’t let Bernie out of her sight.”
Source: Mark Seal. “Madoff’s World.” VanityFair.com. 4/2009.

Keith Dovkants: “Anger over Madoff’s fraud is running high and a lot has been directed against the Madoffs as a couple. A Palm Beach socialite said Ruth played a crucial role in getting people to invest. She said: “They were a real pair at the country club.” Networking among very rich people there is about the best on earth. When there is a cocktail party, husbands always bring their wives and people would try to get to Bernie through Ruth.”
Source: Keith Dovkants. “How I was stung by the oh so charming Madoffs …” The Evening Standard. 12/22/2008. pg 20.

Lord Jacobs: Now friends, such as Lord Jacobs, are left wondering how much the elegant and highly-likeable Mrs Madoff knew about what was happening. “It seems impossible that he could have acted alone,” Lord Jacobs said. “I found Ruth a rather quiet lady, concerned with her charity work. But she’s certainly no fool and his sons were closely involved in the business.” Investigators working for the Securities and Exchange Commission have discovered evidence that Mrs Madoff, 67, monitored financial transactions in her husband’s firm. It was also reported in New York that the SEC had discovered her name on a number of deals.”
Source: Keith Dovkants. “How I was stung by the oh so charming Madoffs …” The Evening Standard. 12/22/2008. pg 20.

Mark Seal: “Their wedding was described as a “very nice Jewish wedding-sit-down dinner …”
Source (includes photo of Bernie and Ruth Madoff): Mark Seal. “Madoff’s World.” VanityFair.com. 4/2009.

Joseph Kavanau: “… the first home Mr. Madoff shared with his bride was a modest, one-bedroom apartment in Bayside, Queens.”
Source: Julie Creswell, Landon Thomas Jr. “The Talented Mr. Madoff.” NYTimes.com. 1/24/2009.

Convicted on 11 counts, sentenced to serve 150 years, Bernard Madoff continues to be in the news as the investigation about his Ponzi scheme forced Bernard and Ruth Madoff to forfeit their homes, investments, vehicles, boats, etc.

12/13/2010: While Bernie Madoff will not attend his son’s funeral, his wife “Ruth Madoff is, ‘totally disgusted with [Bernie] and blames him for her son’s death,’ [Jerry]

Oppenheimer tells the New York Post. ‘She thinks this is the end of the family.'”
Source: “Mark Madoff Funeral: author Says Ruth Madoff Claims Husband’s Ponzi Scheme Drove Son to Suicide.” HuffingtonPost.com. 12/13/2010.

8/15/2009: In her book, Madoff’s Other Secret: Love, Money, Bernie, and Me (Compare Prices), Sheryl Weinstein alleged that she had a long affair with Bernie Madoff. “An attorney for Madoff’s wife, Ruth Madoff, said his client did not know about the “alleged affair.” The attorney, Peter Chavkin, said the allegations were a powerful reminder to those who claim Ruth Madoff knew about her husband’s massive Ponzi scheme “that there are some things that some spouses — however close they are — do not share with each other.” Source: Larry Neumeister, AP. “Book: Madoff victim tells of secret 20-year affair.” WashingtonPost.com. 8/15/2009.

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7/13/2009: Bernard Madoff, aka prisoner 61727-054, was transferred to the Federal Correctional Complex in Butner, North Carolina. According to The Associated Press, “under federal regulations, the lengthy prison term Madoff received at his June 29 sentencing made him ineligible for placement in a minimum- security prison.”

7/06/2009: The court system was ordered by a federal judge to return Ruth Madoff’s passport.

7/02/2009: Ruth Madoff was evicted from their $7 million penthouse.

6/29/2009: Bernard Madoff was sentenced to serve 150 years in federal prison. His wife, Ruth, was not in court. Ruth Madoff’s Written Statement of 6/29/2009

6/28/2009: Just prior to Bernard Madoff’s sentencing for his gigantic swindle, a preliminary order of forfeiture forces Ruth and Bernard to give up all their interests in real estate, investments, cars, boats, and insured or salable personal property that are in the homes. Ruth will be able to keep $2.5 million in cash.

3/16/2009: Although Ruth Madoff has still not been charged with any crime, federal prosecutors are asking for the forfeiture of Madoff homes, cars, yachts, and other assets even though most are registered in Ruth’s name.
Source: “Government Files Notice Seeking Madoff Assets.” NYTimes.com. 3/16/2009.

3/12/09: We didn’t notice any pictures of Ruth Madoff standing by Bernie in court. “But, preparing for jail, he wore no wedding ring — only the shadowy imprint remained of one he has worn for nearly 50 years.”
Source: Diana B. Henriques and Jack Healy. “Madoff Goes to Jail After Guilty Pleas to All Charges.” NYTimes.com 3/12/2009.

3/12/09: After pleading guilty to 11 charges Bernard Madoff was handcuffed and taken to jail “to the applause of his seething victims in the courtroom.”
Source: AP / Larry Neumeister and Tom Hays. “Madoff Pleads Guilty to Mass Ponzi Swindle.” Time.com. 3/12/2009.

3/10/09: “He is not reliable. He’s jerking everyone around,” said the source. “Every day he changes his tune about where the money went and where it is. He’s trying to protect his family … Ruth Madoff, who was considered “innocent at first,” according to this source, is believed to have received at least $70 million from her husband and is now therefore an object of the investigation. That is one reason why she recently decided to retain her own lawyer, leaving Ira Sorkin, who has represented both of the Madoffs since December, when the Ponzi scheme was revealed.”
Source: Lucinda Franks. “The Next Targets in the Madoff Case.” TheDailyBeast.com. 3/10/2009.

2/11/09: “… Wednesday’s revelation regarding Mrs. Madoff’s financial withdrawals only raises the likelihood that prosecutors will look closely at family members’ actions.”
Source (includes photo of Ruth and Bernie Madoff): Robert Chew. “Ruth Madoff Withdrew $15.5 Million Prior to Husband’s Arrest.” Time.com. 2/11/2009.

Summing-Up

Bernard I. Madoff ran a fraudulent investment fund that could cost investors as much as $50 billion. The money from new investors paid the returns for existing customers, a fraud known as a Ponzi pyramid scheme.

Question: What is a Ponzi scheme and what does it have to do with business?

Answer: A Ponzi scheme is a type of fraud that is a really simple investing scheme. An investment company or investment manager promises potential clients a high return on their investments with low risk.

The money from the early investors with the company is used to pay the newer investors in the company. This scheme works as long as there are more and more investors with the company whose money can be used to pay newer investors. When the new investors stop, then the company can’t keep up with paying the older investors anymore.

This is when the Ponzi scheme has to stop. Usually, the investment manager disappears with the money at this point.

Question: What is the history of the Ponzi scheme?

Answer: The Ponzi scheme was named for Charles Ponzi, an Italian immigrant, who came to America looking for wealth and riches. In 1919, he established The Security Exchange Company. He bragged that he earned a 50 percent return for his clients in 90 days. Obviously, everyone wanted to invest with him.

He actually had investors standing in line outside

his office. He paid investors their supposed 50 percent return from the money received from earlier investors. The Ponzi scheme was set up much like the current pyramid marketing schemes. This swindle was set up on a grand scale and many investors lost their money before he was exposed.

Question: What Is the Best Protection Against a Madoff-type Ponzi Scheme?

Answer: Madoff investors had the ability to hire the best financial advisers. Instead, they put all their money with someone who swindled them. You don’t need to pay for expensive financial advice to learn from these millionaires’ mistakes. Rule #1 — It’s always best to place less than 15-20% of your net worth in any one investment. That way, if you do get swindled, you won’t lose all your money. That’s why the best protection for most investors is a well-diversified portfolio.

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