Bernard Madoff, mastermind of giant Ponzi scheme, dies in US prison aged 82
- Madoff was serving a 150-year sentence for engineering a fraud estimated as high as US$64.8 billion
- Among those he betrayed were actors Kevin Bacon, Kyra Sedgwick and John Malkovich; and a charity associated with Steven Spielberg
Bernard Madoff, who was convicted for running the largest known Ponzi scheme in history, died on Wednesday in prison where he was serving a 150-year sentence, the US Federal Bureau of Prisons said. He was 82.
Madoff for decades presented himself as a successful and trusted Wall Street kingpin while secretly engaging in investment fraud, prompting his sentencing judge to condemn his crimes as “extraordinarily evil”.
A spokeswoman for the prison bureau said Madoff’s death at the Federal Medical Center in Butner, North Carolina, at about 3.30am, was believed to be from natural causes. Madoff had been suffering from terminal kidney disease and several other medical ailments.
He had been held at the Butner prison after being sentenced in June 2009 for engineering a fraud estimated as high as US$64.8 billion.
Madoff had last year sought “compassionate release” from prison so he could die at home, but the judge who had originally sentenced him to prison rejected that request.
“Bernie, up until his death, lived with guilt and remorse for his crimes,” Madoff’s lawyer Brandon Sample said in a statement.
“Although the crimes Bernie was convicted of have come to define who he was – he was also a father and a husband. He was soft-spoken and an intellectual. Bernie was by no means perfect. But no man is.”
Madoff’s thousands of victims, large and small, included individuals, charities, pension funds and hedge funds. Among those he betrayed were the actors Kevin Bacon, Kyra Sedgwick and John Malkovich; baseball Hall of Fame pitcher Sandy Koufax; and a charity associated with director Steven Spielberg.
Owners of the New York Mets, long-time Madoff clients, struggled for years to field a good baseball team because of losses they suffered.
“We thought he was God. We trusted everything in his hands,” Nobel Peace Prize winner Elie Wiesel, whose foundation lost US$15.2 million, said in 2009.
Some victims lost everything. Many came from the Jewish community, where Madoff had been a major philanthropist.
Madoff’s crimes were revealed to authorities in 2008 by his two sons, who were not part of the scheme.
The fraud exposed holes at the US Securities and Exchange Commission, which through incompetence or neglect botched a half-dozen examinations. “There were several times that I met with the SEC and thought, ‘They got me,’” Madoff told lawyers in a prison interview.
Madoff had been the largest marketmaker on the Nasdaq, once serving as its non-executive chairman. His brokerage firm was located in a Midtown Manhattan tower known as the Lipstick Building.
Employees there said they felt like part of Madoff’s family. They did not know he was running his fraud on a different floor. Only a trusted few did.
In a typical Ponzi scheme, money from newer investors is used to pay sums owed to earlier investors.
Madoff said his fraud began in the early 1990s, but prosecutors and many victims believe it started earlier.
Investors were entranced by the steady, double-digit annual gains that Madoff seemed to generate, and which others found impossible to explain or duplicate.
The money helped Madoff and his wife, Ruth, enjoy luxuries such as a Manhattan penthouse, a French villa and expensive cars and yachts, with a combined net worth of about US$825 million.
But no one from Madoff’s immediate family was in the Manhattan courtroom when US District Judge Denny Chin sentenced him. And no family, friends or supporters submitted letters attesting to his good character or deeds in support of leniency.
“I believed when I started this problem, this crime, that it would be something I would be able to work my way out of, but that became impossible,” Madoff told the court. “As hard as I tried, the deeper I dug myself into a hole.”
Madoff also addressed victims in attendance, saying, “I am sorry. I know that doesn’t help you.”
The pain for Madoff’s family did not end with the patriarch’s imprisonment. Tormented by his father’s actions and by lawsuits, Mark Madoff, the older son, hanged himself with a dog leash at age 46 on December 11, 2010, the second anniversary of his father’s arrest. In September 2014, Andrew Madoff died of cancer, at age 48.