f ro m f ro n t f l a p ) Engaging and at times unbelievable, Madoff with the Money weaves stories of Madoff ’s past with those of the present and delves into the details of the elusive man who lost investors billions While a lot has been written about the Bernie Madoff debacle, no other account digs as deep or goes as far to uncover the truth behind the man and his incredible scam Photo: Caroline Walton Howe JERRY OPPENHEIMER has written eight biographies of major American icons, from Martha Stewart and Barbara Walters to the Clintons and Kennedys, and has worked in all facets of journalism, from national investigative reporting in Washington, D.C., to producing TV news and documentaries He’s quoted in magazines such as Vanity Fair and is a frequent guest on national TV interview and syndicated magazine shows, including Good Morning America, Entertainment Tonight, Extra, Anderson Cooper 360°, Nancy Grace, BBC News, Fox News, and more He is also the author of the Wiley title Toy Monster: The Big, Bad World of Mattel Jacket Design: Michael J Freeland Jacket Photograph: © Getty Images Praise for Jerry Oppenheimer’s Toy Monster “Jerry Oppenheimer, best known for mordant biographies like Just Desserts (about Martha Stewart) or State of a Union (on Bill and Hillary Clinton’s marriage), has now trained his sights on the world’s biggest toy company—its egos, scandals, and flawed products In his toyland, nothing is cute.” —T h e W a l l S t r e e t J o u r n a l “Oppenheimer takes a tour of Mattel’s seamier side, highlighting its dubious corporate practices and kooky cast in this scathing portrait Fast-paced and engaging, this exposé will absorb readers until the last page and will forever change the way they think about the company.” —P u b l i s h e r s W e e k l y “This juicy exposé shows that life inside the 64-year-old company was hardly always fun and games.” —Pe o p l e m a g a z i n e hile Bernie Madoff may have pulled off one of the biggest financial scams ever, the details of his life and long-running ruse are still cloaked in mystery with more questions than answers Until now W In Madoff with the Money, Oppenheimer goes behind the glaring headlines, the myriad lawsuits, indictments, and complaints to tell the real story of the enigmatic, bizarre life of Ponzi King Bernie Madoff—who Nobel Peace Prize Laureate and Madoff victim Elie Wiesel called “a thief, scoundrel, criminal psychopath [is] too nice a word for him.” From dozens of exclusive, news-making interviews with the people who knew Madoff best—or thought they did—a shocking portrait emerges From the one-time nobody who uses his cunning and street smarts we see emerge a respected Wall Street titan, all the while leading a twisted life with multiple personas like a financial Dr Jekyll and Mr Hyde OPPENHEIMER MADOFF MONEY ( c o n t i n u e d $24.95 USA / $29.95 CAN “I said to Bernie, ‘What’s going on? What are you getting ready for?” because he’s drinking this weird mix–whiskey and taking this other stuff to calm his stomach–and all he says is, ‘I’m getting ready to battle I’m getting ready to make a decision.’ That’s all he said It sounds nuts, but it’s more like the bizarre world of Madoff.” —From Madoff with the Money M WITH THE JERRY OPPENHEIMER N E W matte finish w /spot lam on title and author’s name Through Jerry Oppenheimer’s in-depth reporting, you’ll discover Bernie Madoff as the high school English class cheat, the gung-ho ROTC cadet who pulls a fast one on Uncle Sam, and the ambitious macher who has very special reasons for choosing “Josie College” as his lawful wedded wife The exclusive material also includes a Madoff family member who speaks out for the first time You’ll find new revelations in this startling case and become familiar with the trusting victims—ranging from nonprofit Jewish charities to the likes of seemingly sophisticated individuals such as actress Jane Fonda, who would “like to shake Madoff until his teeth fall out” to the scion of the BaskinRobbins ice cream empire, who lost a bundle and was forced to rent out rooms in his house There’s even a number of Madoff ’s own family members, including his sister and sister-in-law and talk show host Larry King, who apparently didn’t ask the right questions when they invested Some lost their much-needed life savings, while others saw fortunes small and large evaporate in the greedy financial operations of one of history’s all-time charlatans Oppenheimer also unearths details on Madoff ’s “stockbroker guru” doing business with the Mob, the adultery hush money, and then there are the many compulsions, obsessions, and fetishes that read like something out of a psychology textbook, and much, much more Y O R K T I M E S B E S T S E L L I N G A U T H O R Madoff will spend the rest of his life in prison But the mindboggling case of the fraudster is far from over, and will continue beyond many of our lifetimes, as an army of federal prosecutors, lawyers, and forensic accountants search for the missing money, and try to find out who knew what and when His wife? His sons? His brother? Others? ( c o n t i n u e d o n b a c k f l a p ) ffirs.indd ii 7/24/09 8:52:41 PM WITH THE MADOFF MONEY ffirs.indd i 7/24/09 8:52:41 PM ffirs.indd ii 7/24/09 8:52:41 PM WITH THE MADOFF MONEY JERRY OPPENHEIMER John Wiley & Sons, Inc ffirs.indd iii 7/24/09 8:52:41 PM Copyright © 2009 by Jerry Oppenheimer All rights reserved Published by John Wiley & Sons, Inc., Hoboken, New Jersey Published simultaneously in Canada No part of this publication may be reproduced, stored in a retrieval system, or transmitted in any form or by any means, electronic, mechanical, photocopying, recording, scanning, or otherwise, except as permitted under Section 107 or 108 of the 1976 United States Copyright Act, without either the prior written permission of the Publisher, or authorization through payment of the appropriate per-copy fee to the Copyright Clearance Center, Inc., 222 Rosewood Drive, Danvers, MA 01923, (978) 750-8400, fax (978) 646-8600, or on the web at www.copyright.com Requests to the Publisher for permission should be addressed to the Permissions Department, John Wiley & Sons, Inc., 111 River Street, Hoboken, NJ 07030, (201) 748-6011, fax (201) 748-6008, or online at http://www.wiley.com/go/permissions Limit of Liability/Disclaimer of Warranty: While the publisher and author have used their best efforts in preparing this book, they make no representations or warranties with respect to the accuracy or completeness of the contents of this book and specifically disclaim any implied warranties of merchantability or fitness for a particular purpose No warranty may be created or extended by sales representatives or written sales materials The advice and strategies contained herein may not be suitable for your situation.You should consult with a professional where appropriate Neither the publisher nor author shall be liable for any loss of profit or any other commercial damages, including but not limited to special, incidental, consequential, or other damages For general information on our other products and services or for technical support, please contact our Customer Care Department within the United States at (800) 762-2974, outside the United States at (317) 572-3993 or fax (317) 572-4002 Wiley also publishes its books in a variety of electronic formats Some content that appears in print may not be available in electronic books For more information about Wiley products, visit our web site at www.wiley.com ISBN 978-0-470-50498-7 Printed in the United States of America 10 ffirs.indd iv 7/24/09 8:52:44 PM For all the legitimate victims of Bernie Madoff’s Ponzi scheme, this story is for you ffirs.indd v 7/24/09 8:52:44 PM ffirs.indd ii 7/24/09 8:52:41 PM ffirs.indd vi 7/24/09 8:52:44 PM Contents Prologue xi Beginning of the End Growing Up a Madoff Bernie Hobnobs with the Wealthy, Strong-Arms Some Pals, and Courts “Josie College” Chapter From Queens to Alabama, Scamming Homeowners and Hustling Stock Chapter Tying the Knot and Giving Uncle Sam the Business Chapter A Borscht Belt Summer Camp Sets the Stage for Bernie’s Ponzi Scheme Chapter Moving On Up Chapter The Bagel Baker Becomes a Financial Guru, and the Mob Boys from Rockford Pay a Visit Chapter “Whatever You Do, Kid, Never Invest a Penny in the Stock Market, Because It’s Run by Crooks and Sons of Bitches” Chapter 10 A Madoff Speaks Out and an Empty Promise Chapter 11 Mr Outside versus Mr Inside versus the SEC 21 Chapter Chapter Chapter 37 47 61 69 85 93 113 133 145 vii ftoc.indd vii 7/24/09 8:52:58 PM Index Kotz, David, 176, 229 Kotz report, 176 Koufax, Sandy, 222 Krakauer, Hoong-Yee Lee, 141–142, 144 Krakauer, Seth, 142 Kuperberg, Martin, 75 Last investors, 4–7 Lauer, Matt, 14 Laurelton: Alpern house, 70 Alpern house sale, 82 Alperns move to, 32 Boy Scouts of America, 31 commuter town, 30 Elliot Olin, 38, 45, 65, 88 family house in, 24 fear of blacks, 38 fitting in, 26 Italian and Jewish middle-class community, 23 Jay Portnoy, 88 Jewish Center, 31 Jewish Center marriage, 61 Keds sneaker episode, 26, 159 Marion Dickstein Sherman, 38 Marion Sue Schwartzberg, 129 Public School 156, 29–30 Ruth and Jane’s friendship in, 32–33 small town feel, 30 Wiener family, 212 Lautenberg, Ellen, 130–131 Lautenberg, Frank R., 130–131 Lautenberg, Joshua, 130–131 Lawn sprinkler systems, 43–44, 53–57 Leukemia, 27, 71, 79, 109, 135–137, 212 Leukemia for Chickens: One Wimp’s Tale about Living though Cancer (Madoff, Jennifer), 135 Leukemia research funding, 137 Levinson, Adele, 71 Levinson, Myles, 71 Levy, Frances, 203 Levy, Norman, 202–203 Levy Foundation, 203 Lew, Mark, 111 Lieberbaum, Carol Ann (Martz), 54, 93–96, 99, 100–101, 103, 109, 111–112, 118 Lieberbaum, Cynthia (Greenberger), 40, 93–96, 98, 103–104, 109, 161 bindex.indd 251 251 Lieberbaum, Jonny, 93 Lieberbaum, Lillian, 101 Lieberbaum, Lou, 54, 56, 58, 98, 100–104, 107–109 Lieberbaum, Michael, 38, 41, 93–94, 98, 101–104, 109 Lieberbaum, Sheldon, “Shelly,” 54, 93–94, 99, 101–104, 107, 109–111 Lieberbaum & Company, 54, 63, 100, 102–105, 107–108, 110, 113 Lieberbaum and Madoff, 104 Lifeguard, 43 Loan forfeiture, 230 Loan sharks, 107 “The Loneliest Woman in New York” (New York Times), 173 Loonin, Herman, 85 Lubitz, Charles “Chuck,” 64–65, 89–90 Luchese crime family, 154 Lucy, Autherine Juanita, 47–48 Lymphoma, 137 Lymphoma research funding, 137 Maccabee, John, 40–41, 93, 96–98, 161, 221 Maccabee, Sherry, 96 Macher, 58, 64, 66, 152, 166 Mackey, Clarence, 88 Madoff, Andrew: at annual beach party, 182 Bernie confesses to, 10 business involvement by, 13, 68, 102, 195–196 cancer, 198 children’s private schools, 199 Christmas presents, 210 credit card expenses and charges, 169 education, 197 nature of, 198 on Roger’s death, 135 turns in Bernie to authorities, 151 Upper East Side Manhattan home, 174 Wyoming vacation trip, 173 Madoff, Bernard Lawrence “Bernie” See also Far Rockaway High School; feeder funds; Laurelton; obsessive-compulsive behavior: affairs, 185–186 antique furniture, 14–15, 147, 161, 200, 230 7/24/09 9:45:57 PM 252 INDEX Madoff, Bernard Lawrence “Bernie” (continued) appearance, 24, 39, 66, 91, 147 Army Reserve Officer Training Corps (ROTC), 49, 53, 63 bill payment promptness, 126 boats, 166, 177–179, 230 book report fraud, 22 Boy Scouts of America, 31–32 breakfast habits, 181 Brooklyn Law School, 64, 66, 146 cash-hunting expedition, childhood, 23–24 childhood friendships, 30–31 clothing fetish, 68, 159–165, 168, 181 college, 47–50, 53, 63–65, 83 college friendships, 49–50 country clubs, 89 court appearance, 17 Crabbe, Buster, 108 Davidoff cigars, 124 draft deferment, 64 elementary school, 30 emotions, 234 FBI arrest, 13–16 fraternity, 48 fraud admission, 14–15 Fresh Meadow Country Club, 89 friends, 94 friendships, 54–55, 124, 126–127, 202, 214–216 full-body masseuses, 184–185 golf, 92, 167 high school, 21–23, 31, 38–39, 40–42, 44–45 housing, 86–89, 159, 161, 171–172, 177–179, 198, 230 intelligence, 39, 56, 72, 144, 206 Keds sneaker episode, 25–26, 159 Lauer, Matt, 14 lawn sprinkler systems, 43–44, 53–57 lifeguard, 43 macher, 58, 64, 66, 152, 166 medical discharge, 66 men’s shops, 159, 188 mentors, 69, 98, 214–216 military service, 49, 53, 63–64, 66–68 motivation, 82 offices, 85, 102, 146, 147, 183 private jet, 180 Public School 156, 22, 27 bindex.indd 252 relationships, 98 remorse or compassion, 219 remorse or emotion, 235 sibling rivalry, 145 Sigma Alpha Mu (Jewish fraternity), 48 social life, 89 “Susan” (prison name), 172 “T-bill Bernie,” 79 University of Alabama, 47, 49 Yeshiva University, 83, 119 Madoff, Deborah, 169 Madoff, Jennifer, 134–136, 138, 140 Madoff, Marion Sue (Schwartzberg), 129, 134, 140, 142–144, 146, 169, 175, 189, 195 Madoff, Mark: at annual beach party, 182 Bernie confesses to, 10 business involvement by, 68, 102, 195–196, 202 Christmas presents, 16, 210 credit card expenses and charges, 169 education, 198 on family business, 151 Greenwich, Connecticut mansion, 201 marriage of, 90, 199–201 Nantucket home, 174 nature of, 198 on Roger’s death, 135 turns in Bernie to authorities, 151 Wyoming vacation trip, 173 Madoff, Peter: acceptability/character of, 197 asset freeze, 129, 130 Aston Martin (James Bond car), 179 Bernie’s confession to, business involvement by, 68, 102, 114, 129, 235 Christmas presents, 16 claims mother’s body, 125 credit card expenses and charges, 169 death of son, 135–136 early years of, 23 Fordham Law School, 146 intelligence, 44, 144 at last Christmas party, 11–12 lawn sprinkler systems, 143 marriage of daughter, 189 purchases by, 175–176 Queens College, 145 7/24/09 9:45:58 PM Index relationship with Bernie, 148–150, 180 social life, 142–143 Madoff, Ralph Z., 23, 29, 34, 43, 85, 117 Madoff, Roger, 135–139, 142, 151, 194, 198, 212 leukemia, 136, 212 Madoff, Ruth (Alpern): 50th year reunion appearance, 44–45 antique furniture situation, 147–148 appearance of, 34 asset seizure, 230 assets in her name, 178 Bernie’s control over, 147–148, 161 Bernie’s infidelity to, 185 childhood friendships, 32–33 Chivas Regal episode, 114 Christmas presents, 210 clothing purchases, 168 country club membership, 90 credit card expenses and charges, 171 early relationship with Bernie, 53 Great Chefs of America Cook Kosher, 63 involvement of, in Bernie’s business, 102, 210–211 marital privilege invocation, 170 marries Bernie, 61–62, 69 as match for Bernie, 35 and orchids, 195 as pariah, 134–135 post collapse/arrest impact, 234, 236–237 Queens College, 62–63 relationship with parents, 82–83 as shopper and spender, 167–173 social acceptability of, 215–216 social life, 87–88 spending habits, 170 sympathy or remorse response, 137, 171–172 ten million dollar withdrawal, 7–8 visits Bernie in jail, 133 written statement, 236–237 Madoff, Shana, 12, 129, 139–140, 169, 180, 182, 188, 191–195 See also Skoller, Shana (Madoff ); Swanson, Shana (Madoff ) (Skoller) Madoff, Sondra “Sonnie,” 23, 27 See also Wiener, Sondra (Madoff) Madoff, Susan (Freeman), 201–202 Madoff, Sylvia “Susie” (Mummer), 23, 25, 28, 29, 104, 125 See also Gibralter Securities bindex.indd 253 253 Madoff account statements, 227 “Madoff Blistered His Sister” (New York Post) See Hanukah gift packages “The Madoff Dynasty” (Wall Street & Technology), 150 Madoff Energy, 10 Madoffs, Ralph and Sylvia, 24, 27, 28, 53, 69 Madoff Securities International Limited (MSI), 179–180 Mail (newspaper), 181 Mail fraud, 153 Malkovich, John, 222 Marital privilege invocation, 170 Market manipulation, 109 Markopolos, Harry, 153, 154–156, 157, 203 Marsden, Carol Solomon, 42 Marshal, Thurgood, 48 Martin J Joel & Company, 121–122 Martz, Carol Ann See Lieberbaum, Carol Ann (Martz) Mayfair bookkeeping, 75 Mazzarella, Robert, 196 Medical discharge, 66 Meeschaert, Cedric, 178 Mendelow, Steve, 226–227 Men’s shops, 159, 188 Mentors: Lou Lieberman, 98 Ralph and Sylvia Madoff, 69 Saul Alpern, 69 Stanley Shapiro, 214–216 Merkin, J Ezra, 11, 84 Merrill Lynch, 135 Metropolitan Correctional Center, 133, 170, 172, 229 Military service: Army Reserve Officer Training Corps (ROTC), 49, 53, 63 claims of, 66–67 draft deferment, 64 medical discharge, 66 military clothing fetish, 68 Milken, Michael, 221 The Mob, 154 “Mom and Dad and Ruth and Bernie—Our Friend the Swindler” (Maccabee, John), 221 Money laundering, 105 Money-management clients, 175 Monness, Andy, 118–120 7/24/09 9:45:58 PM 254 Montgomery, Daryl, 205–206 Motivation, 82 Mr Inside-Mr Outside situation, 148 Muffin (dog), 87 Muriel Siebert & Company, 184 Muttontown, Long Island, 143 Name changes, 111 NASDAQ, 52, 149, 150, 206 Nasi, William: 39 Broadway office, 102 on Bernie’s fear of the SEC, 155–156 on Bernie’s impact, 213, 215 on Bernie’s military service claims, 67–68 on Bernie’s relationship with Eleanor Squillari, 186–188 on Bernie’s treatment of Peter, 147 Chivas Regal episode, 114–115 Christmas party, 11, 13 on Ralph Madoff, 27, 117 sexual shenanigans in office, 184 National Association for the Advancement of Colored People (NAACP), 48 National Association of Securities Dealers (NASD), 109, 148 Neff, David, 160, 165–168 Nepotism, 115 The New Good Life (Robbins, John), 229 New York Daily News, 18, 110–111, 186, 230 New York Investment meetup, 205–206 New York magazine, 138, 191, 221 New York Post, 128–129, 134, 157, 173, 212, 229, 236, 237 New York Times, 15, 17, 48, 83, 109, 171–172, 173, 175, 193, 199 Noel, Walter, Nonprofit organizations, 119 Norville, Deborah, 193 NYSE, 149 Obsessive-compulsive behavior, 26, 114, 125–126, 142, 162, 183, 200 See also bull statues and boat names; clothing fetish; watches Offices: 39 Broadway, 102, 146 110 Wall Street, 146 Exchange Place, 85 Lipstick Building, 147, 183 bindex.indd 254 INDEX Third Avenue, 146 Olin, Elliot, 21, 26, 28–32, 45, 65, 67, 88, 212 Olin, Sheila, 26–28, 65, 67, 88 Ondis, Gordon, 54–56, 58 Orchids, 13–14, 175, 195 Organized crime, 236 gangsters, 105 Luchese crime family, 154 Over-the-counter trades, 103 “Painting picture in the sky” ability, 101 Palm Beach Country Club, 92, 167 Parents, 23–27 See also Madoff, Ralph Z.; Madoff, Sylvia “Susie” (Mummer) Payments to himself, Petrillo, Frank, 196 Philoctetes Center, 202–203 Picard, Irving, 6, 17, 77, 169, 177, 179 Picower, Barbara, 166–167 Picower, Jeffry, 77, 166–167 Pierre Michel hair salon, 134 Pink Sheets, 146 Polaroid, 99 Politicians, 131 Ponzi, Charles, 152–153 “Ponzi King Takes Chutzpah Crown” (New York Post), 229 Ponzi scheme, 152–153 “Ponzi Schemer’s Label-Whoring Niece Married SEC Lawyer” (Gawker), 177 Portnoy, Jay, 21–22, 25, 30–31, 38, 42, 45, 70, 88 Portnoy, Mrs., 88 Primex Trading, 135 Prior notice, 76 Prison consultants, 124 Prison name, 172 Private jet, 180 Prosetti, Marco, 172 Public School 156, 22, 27 Pump-and-dump stock, 106 Queens Council on the Arts, 141–142 Racing News, 107 Racism, 48 Rampart Investment Management, 153 Record keeping, 74 Record newspaper, 131 7/24/09 9:45:58 PM Index Redemption demands, 2, Relationships, 98 Remorse or compassion, 219 Remorse or emotion, 235 Riccio, Ronald, 130 Rifkin, Ron, 138 Robbins, Irvine, 224 Robbins, John, 224–229 Rochelle, Eddie, 102 Rockford boys (gangsters), 106 Roger Madoff Literary Fellowship, 140–141, 143–144 Roman, Bob, 83, 210, 211–212 Roman, Joan (Alpern), 82, 83, 210, 211–212 Roommates, 50 Roscioli, Robert, 178 Rosenman, Martin, 4–7 Roth, Eric, 222 Samuels, Andrew Ross, 128, 130 Samuels, Howard, 123, 124, 127, 128, 130 Samuels, Patty (Joel), 121, 123, 127, 128 Schapiro, Mary, 157 Schotsky, Arnold, 58 Schrager, Marty, 50–51 Schwartzberg, Marion Sue See Madoff, Marion Sue (Schwartzberg) SEC news digest, 85 Securities and Exchange Commission (SEC): Avellino and Bienes, 52, 74 Bernie registers with, 63 Chais investigation, 78 Cohmad company, Eric Swanson from, 138 Gibralter Securities, 29, 58, 74 Harry Markopolos contacts, 154, 155 House Financial Services Subcommittee query, 156 investigation, 156 investigative and regulatory failure, 157 Ivan Boesky, 123 Kotz report, 176 Madoff, Sylvia “Susie” (Mummer) (mother of BM) and, 28 Martin J Joel & Company investigation, 122 staff incompetency, 157 stock manipulation, 106 Securities Industry Association, 148 bindex.indd 255 255 Sedgewick, Kyra, 220 Sentencing advocacy, 124 Sex and racism, 110–111 Sexual shenanigans, 184 Shapiro, Carl, 4, 77, 135, 167 Shapiro, Mary, 158 Shapiro, Stanley, 124, 214–215 Sherman, Marion Dickstein, 38 Shulman, Hedy, 83 Shweder, Richard A., 172 Sibling rivalry, 145 Sidel, Kenny, 120 Siebert, Muriel, 202 Sierer, Richie, 41 Sigma Alpha Mu (Jewish fraternity), 48 Silverstein, Jane, 24, 32–33 See also Kavanu, Jane Silverstein Skoller, Rebecca, 138, 142, 190 Skoller, Scott Ira, 188, 189–190, 191–192 Skoller, Shana (Madoff), 188, 189–190, 191–192 Skoller, Trina, 188 Sobel, Gabriel, 85 Social life, 89 Social Security Number, 155–156 Somlo, George, 163–165 Somlo Antique shop, 163 Sorkin, Ira Lee, 74, 106, 179, 229–230, 234 South Florida Sun-Sentinel, 75 Spielberg, Steven, 219, 222 Split-strick conversion, 152 Sports, 31 Squillari, Eleanor, 12–13, 128, 134, 147, 184, 186–187, 213 Stahl, Richard, 196 Steiger, Paul, 157 Stem cell transplant donor, 138 Stewart, Martha Kostyra, 120 Stock manipulation, 105–106, 122 Stock market crash, 1–3 Stock selling commission, 57–58 Suicides, 217–218 Sunny Oaks, 70, 82 Sununu, John F., 107 Sununu, John H., 107 “Susan” (prison name), 172 Swag bags, 16 Swanson, Eric, 138, 176, 182, 193, 194 Swanson, Shana (Madoff) (Skoller), 138–140, 142, 176–177, 184 7/24/09 9:45:58 PM 256 Swanson’s East Hampton house, 176 Swimming, 40–42 “T-bill Bernie,” 79 Teletnick, Tony, 67 Thomsen, Linda Chatman, 157 Time magazine, 123, 203 Today show, 186 Traders magazine, 148, 149 Trillion boutique, 159, 165–166 Trump, Donald, 221 Trustee, 128–129 Tucker, Jeffrey H., 8–9 Tyrone (men’s clothes), 188, 190 University of Alabama, 47, 49 U.S Equal Opportunity Commission (EEOC), 110 U.S Supreme Court, 106 Vanity Fair, 13, 147, 151, 184, 186, 197 Victims’ letters, 216–217 Von Anhalt, Frederick, 222–224 Wall Street (film), 123 Wall Street & Technology, 150 Wall Street Journal, 18, 75, 77, 96, 156, 157, 167, 176, 193, 237 Warner, Robin, 80–81 bindex.indd 256 INDEX Warrin, Christopher, 174 “Was Ponzi Man Bernie Madoff a Philanderer, Too?” (New York Daily News), 186 Watches, 39, 163–164 Wedding, 61–62 West, Deborah Anne, 199 West, Douglas, 199 West, Susan I., 199 Whistle-blowers, 154 Wiener, Ariel, 137 Wiener, Carolyn, 212 Wiener, Charles, 28, 115, 137, 169, 198, 210, 212 Wiener, David, 212 Wiener, Marvin, 27, 65, 212 Wiener, Sondra (Madoff), 27, 65, 210, 212 Wiesel, Elie, 18 Wiesel, Marion, 18 Wiesenthal, Joe, 76 Williams, Kaiser L., 111 Wilpon, Fred, 140, 146, 201 “The World’s Largest Hedge Fund Is a Fraud” (Markopolos), 154 Yeshiva University, 83, 119 Zaphiris, Peter, 29, 39, 63, 100, 101–108 Zeiger, Lawrence Harvey, 221 7/24/09 9:45:58 PM At Far Rockaway High School in Queens, class of June ’56 graduate Bernie Madoff was considered a “dummy” by some classmates, but he also established bonds with wealthy school chums who later invested and lost in his Ponzi scheme Madoff is pictured here a year later in his freshman year at the University of Alabama, but soon left to be closer to his girlfriend back home, Ruthie Alpern Source: University of Alabama Corolla yearbook A far different Bernie as he poses emotionless for his U.S Justice Department mug shot after he admitted in December 2008 that he was running history’s most massive fraud, bilking thousands out of billions of dollars Source: U.S Dept of Justice OppenheimerInsertSample.indd 7/17/09 7:56:53 PM Bernie and Ruth socialized in chic places from Palm Beach to the French Riviera where investors—wealthy and middle class alike, thousands of them—invested in Bernard L Madoff Investment Securities and were taken to the cleaners by the man The couple is shown here at the September 2007 wedding of niece Shana Madoff to Eric Swanson at the Bowery Hotel in New York Source: Rex USA Bernie and the former Ruth Alpern became an item in high school, married young, and were considered a team for half a century But after Bernie was sentenced to spend the rest of his life in prison, she distanced herself from him, and reportedly reverted to her maiden name Source: Rex USA, May 2008 OppenheimerInsertSample.indd 7/17/09 7:56:54 PM Peter Madoff, Bernie’s younger brother, was his second in command, and was considered brighter than his sibling but was dominated by him because it was Bernie’s name on the door of the firm As former Chief Compliance Officer of Bernard Madoff Investment Securities LCC, he is shown here arriving at Mineola State Supreme Court, April 3, 2009, in New York Source: AP Photo/Louis Lanzano Peter’s daughter, Shana, in charge of compliance at Madoff, with her second husband, Eric Swanson, a former SEC official Their nuptials sparked federal prosecutors’ interest Bernie once said his niece had married “the enemy.” Source: JP Pullos/PatrickMcMullan.com OppenheimerInsertSample.indd 7/17/09 7:56:57 PM Bernie’s Ponzi scheme was named after Charles Ponzi, an arrogant, dapper artist for whom the fraud—using later investors to pay early investors—was named Source: Bettmann/Corbis Ponzi central—the high-tech Lipstick Building in Manhattan where Bernie had his firm’s offices on the 17th, 18th and 19th floors On 17 was where he ran his secret investment advisory business, and from where bogus statements were sent to bilked clients Source: AP Photo/Diane Bondareff OppenheimerInsertSample.indd 7/17/09 7:56:59 PM The posh Upper East Side Manhattan co-op building where Bernie and Ruth lived in royal splendor in their $7.5 million duplex penthouse For a time Bernie was under house-arrest there, infuriating investors who had lost everything The Madoff apartment was later ordered sold along with other assets Source: AP Photo/Brian McDermott Photo taken in December 2008 OppenheimerInsertSample.indd 7/17/09 7:57:07 PM Madoff was a great place to work until the roof caved in Every summer the firm’s employees were invited to the firm’s summer bash at Montauk, in the chic Hamptons, where Bernie and Ruth’s fabulous ocean-front house was located Source: AP Photo/John Dunn Among the luxuries owned by the one-time poor boy from Queens were several boats and yachts, all with the name ‘Bull.’ Like the Madoff penthouse, the boats also were seized and ordered sold Source: AP Photo/Lionel Cironneau OppenheimerInsertSample.indd 7/17/09 7:57:09 PM After his arrest, but before he was ordered confined to his penthouse and later sent to jail, the most reviled crook in America had the freedom to walk the streets, with an enigmatic trademark smirk on his face He is seen here walking down Lexington Avenue to return to his Manhattan apartment Source: AP Photo/Jason DeCrow Bernard Madoff leaves U.S District Court in Manhattan escorted by U.S Marshals after a bail hearing in New York, January 5, 2009 Under that black raincoat and suit jacket is a bulletproof vest because prosecutors and his lawyers feared Bernie might be the target of a furious, deranged investor as he leaves court after pleading guilty to eleven criminal counts, and claiming he pulled off his mind-boggling fraud alone, which no one believed was possible Source: AP Photo/Kathy Willens OppenheimerInsertSample.indd 7/17/09 7:57:10 PM The dapper tight-lipped swindler lost in thought before he went to jail to spend the rest of his natural born days The 150 years to which he was sentenced was symbolic, since at 71 he was believed to have about a dozen years left to live Source: Justin Lane/epa/Corbis OppenheimerInsertSample.indd 7/17/09 7:57:12 PM f ro m f ro n t f l a p ) Engaging and at times unbelievable, Madoff with the Money weaves stories of Madoff ’s past with those of the present and delves into the details of the elusive man who lost investors billions While a lot has been written about the Bernie Madoff debacle, no other account digs as deep or goes as far to uncover the truth behind the man and his incredible scam Photo: Caroline Walton Howe JERRY OPPENHEIMER has written eight biographies of major American icons, from Martha Stewart and Barbara Walters to the Clintons and Kennedys, and has worked in all facets of journalism, from national investigative reporting in Washington, D.C., to producing TV news and documentaries He’s quoted in magazines such as Vanity Fair and is a frequent guest on national TV interview and syndicated magazine shows, including Good Morning America, Entertainment Tonight, Extra, Anderson Cooper 360°, Nancy Grace, BBC News, Fox News, and more He is also the author of the Wiley title Toy Monster: The Big, Bad World of Mattel Jacket Design: Michael J Freeland Jacket Photograph: © Getty Images Praise for Jerry Oppenheimer’s Toy Monster “Jerry Oppenheimer, best known for mordant biographies like Just Desserts (about Martha Stewart) or State of a Union (on Bill and Hillary Clinton’s marriage), has now trained his sights on the world’s biggest toy company—its egos, scandals, and flawed products In his toyland, nothing is cute.” —T h e W a l l S t r e e t J o u r n a l “Oppenheimer takes a tour of Mattel’s seamier side, highlighting its dubious corporate practices and kooky cast in this scathing portrait Fast-paced and engaging, this exposé will absorb readers until the last page and will forever change the way they think about the company.” —P u b l i s h e r s W e e k l y “This juicy exposé shows that life inside the 64-year-old company was hardly always fun and games.” —Pe o p l e m a g a z i n e hile Bernie Madoff may have pulled off one of the biggest financial scams ever, the details of his life and long-running ruse are still cloaked in mystery with more questions than answers Until now W In Madoff with the Money, Oppenheimer goes behind the glaring headlines, the myriad lawsuits, indictments, and complaints to tell the real story of the enigmatic, bizarre life of Ponzi King Bernie Madoff—who Nobel Peace Prize Laureate and Madoff victim Elie Wiesel called “a thief, scoundrel, criminal psychopath [is] too nice a word for him.” From dozens of exclusive, news-making interviews with the people who knew Madoff best—or thought they did—a shocking portrait emerges From the one-time nobody who uses his cunning and street smarts we see emerge a respected Wall Street titan, all the while leading a twisted life with multiple personas like a financial Dr Jekyll and Mr Hyde OPPENHEIMER MADOFF MONEY ( c o n t i n u e d $24.95 USA / $29.95 CAN “I said to Bernie, ‘What’s going on? What are you getting ready for?” because he’s drinking this weird mix–whiskey and taking this other stuff to calm his stomach–and all he says is, ‘I’m getting ready to battle I’m getting ready to make a decision.’ That’s all he said It sounds nuts, but it’s more like the bizarre world of Madoff.” —From Madoff with the Money M WITH THE JERRY OPPENHEIMER N E W matte finish w /spot lam on title and author’s name Through Jerry Oppenheimer’s in-depth reporting, you’ll discover Bernie Madoff as the high school English class cheat, the gung-ho ROTC cadet who pulls a fast one on Uncle Sam, and the ambitious macher who has very special reasons for choosing “Josie College” as his lawful wedded wife The exclusive material also includes a Madoff family member who speaks out for the first time You’ll find new revelations in this startling case and become familiar with the trusting victims—ranging from nonprofit Jewish charities to the likes of seemingly sophisticated individuals such as actress Jane Fonda, who would “like to shake Madoff until his teeth fall out” to the scion of the BaskinRobbins ice cream empire, who lost a bundle and was forced to rent out rooms in his house There’s even a number of Madoff ’s own family members, including his sister and sister-in-law and talk show host Larry King, who apparently didn’t ask the right questions when they invested Some lost their much-needed life savings, while others saw fortunes small and large evaporate in the greedy financial operations of one of history’s all-time charlatans Oppenheimer also unearths details on Madoff ’s “stockbroker guru” doing business with the Mob, the adultery hush money, and then there are the many compulsions, obsessions, and fetishes that read like something out of a psychology textbook, and much, much more Y O R K T I M E S B E S T S E L L I N G A U T H O R Madoff will spend the rest of his life in prison But the mindboggling case of the fraudster is far from over, and will continue beyond many of our lifetimes, as an army of federal prosecutors, lawyers, and forensic accountants search for the missing money, and try to find out who knew what and when His wife? His sons? His brother? Others? ( c o n t i n u e d o n b a c k f l a p ) ... and then demanding, that their money be returned In the past, when they needed money from their accounts, they’d get a check within days Suddenly, they were getting the stall Now Bernie was facing... placed their money and trust in feeder funds had never even heard of Bernard Madoff until the end came, and then it was too late c01.indd 7/24/09 8:57:05 PM MADOFF WITH THE MONEY But now as the. .. 2008 for the 180 or so Madoff workers (and for thousands of other Madoff victims across the country and around the world) was going to be far different from Madoff Christmases past The weather service