Bernie Madoff has died in prison at the age of 82. The disgraced financier died on Wednesday morning from natural causes
Bernie Madoff, the disgraced financier who ran the largest Ponzi scheme in US history, has died in prison at the age of 82.
Madoff died on Wednesday morning from natural causes at the Federal Correctional Facility in Butner, North Carolina, where he was 12 years into a 150 year prison sentence.
In February 2020, he asked for compassionate release, claiming he was in a wheelchair, needed round-the-clock care, and had only 18 months to live.
‘I’m terminally ill. There’s no cure for my type of disease.
‘So, you know, I’ve served. I’ve served 11 years already, and, quite frankly, I’ve suffered through it.
‘You know, there hasn’t been a day in prison that I haven’t felt the guilt for the pain I caused on the victims and for my family,’ he told The Washington Post in a phone interview at the time.
He was denied by a judge who said he’d committed ‘one of the most egregious financial crimes’ in US history and needed to pay for it.
Madoff robbed victims 37,000 victims in 136 countries of $64.8 billion, taking one’s money to pay off the other, for two decades before finally being arrested in 2008 after his two adult sons turned him in.
The victims included celebrities, billionaires and people who could barely afford to invest with him in the first place. Some lost everything and at least one killed themselves over the fraud.
One of Madoff’s sons, Mark, hanged himself in December 2010 on the second anniversary of his father’s arrest, and his other son Andrew died from lymphoma in 2014. His wife Ruth moved to Greenwich, Connecticut, after his arrest to live in exile.
In December 2008, Madoff was arrested at his Upper East Side penthouse after Mark and Andrew turned him in. He had confessed to them that there was no money in their family office, Bernard L. Madoff Investment Securities, saying it was all ‘one big lie’.
He had finally been forced to come clean because all of his clients came asking for redemption as a result of the 2008 crash.
Initially, he was given house arrest after posting a $10million bond. He was taken into custody shortly before his trial and was sentenced in June 2009.
Madoff was born in Queens in 1938. His father, Ralph, was a stockbroker and plumber and his grandparents had emigrated to the US from Eastern Europe.
He studied political science then law before founding Madoff Investment Securities in the 1960s. Initially, it was a penny stock trading firm. He brought on his younger brother Peter and his wife Ruth to run the books then, when his kids were old enough, hired them too.
Madoff died at the Federal Correctional Facility in Butner, North Carolina. Last June, his attorney’s asked for compassionate release, claiming he was dying of renal kidney failure and had 18 months to live
Madoff inside Madoff Investment Securities in December 1999, years after the scheme began. He started the firm in the 60s with $5,000, trading penny stocks
In the beginning, he made his money on the spread of buying and selling cheap penny stocks. It was legal but frowned upon by the more establish funds on Wall Street.
It wasn’t until the 1970s, when the practice became legal on bigger trades, that Madoff started making a name for himself on the Street. That was also when he befriended federal regulators – which would become crucial to how long he evaded them years later.
Madoff claims the fraud only began in the 1990s, after the Gulf War which he said stunted the market. Authorities say it went back to the mid 1980s. In the early 90s, Madoff served as the chair of NASDAQ three times.
Former SEC Chairman Arthur Levitt Jr. has admitted in the past that he sought advice from Madoff on how the market worked while he was in his position.
Madoff’s coziness with the regulators allowed him to set up and run the Ponzi scheme.
When the SEC investigated irregularities or suspicious transactions coming from his office, he assuaged them by telling them he had everything under control.
They believed him.
After his arrest, an entire overhaul was ordered to ensure similar crimes wouldn’t go unnoticed again.
His clients included Steven Spielberg, actor Kevin Bacon, former New York Mets owner Fred Wilpon and Nobel Peace Prize winner Elie Weise.
Madoff insisted in prison that he began legitimately but that he started committing fraud in the early 1990s after the Gulf War caused the market to stall.
Bernie with his wife Ruth and their son Andrew at a black tie event on Long Island in 2001. The family lived in the upper echelons of New York City society, splitting their time between Manhattan and The Hamptons
Madoff with his two sons, Mark (left) and Andrew (center) in 2001, in the Hamptons. Mark and Andrew both worked with their father. Mark killed himself on the second anniversary of Madoff’s arrest in December 2010. Andrew died of lymphoma in 2014
Ruth and Bernie Madoff got married in 1959, a year before he founded his firm. They are shown in the 80s in Montauk (left) and at their niece’s wedding at The Bowery Hotel in 2007 (right)
One view of the sprawling Madoff penthouse in Manhattan on East 64th Street. It was sold in 2014 for $14.5million
In one interview with investigators after his release, he seemed to have more sympathy for himself than for his victims.
‘It was a nightmare for me. I wish they caught me six years ago, eight years ago,’ he said.
Prison cellmates and guards at Butner painted a picture of him that was unrepentant.
Madoff was arrested in December 2010 after his two sons turned him in
One said he’d tell them that people kept ‘throwing money’ at him and that they were offended if he declined to take it, so he did.
Madoff’s victims ranged from financiers who lost over $1billion to small business owners.
At least three have killed themselves, including French aristocrat and billionaire Thierry Magon de La Villehuchet and money manager Charles Murphy.
They didn’t lose their own money but had invested their clients money with Madoff.
In 2010, Madoff’s eldest son Mark killed himself in his New York City apartment. According to sources close to Bernie at the time, he looked like he’d been ‘shot’ when he found out about it.
Mark’s widow later blamed her father-in-law. She said her husband – who worked at the firm with his father but who claimed he never knew about the fraud – told ABC: ‘He couldn’t get out, he was so betrayed and so hurt by Bernie.
‘I hate Bernie Madoff. If I saw Bernie Madoff right now, I would tell him that I hold him fully responsible for killing my husband, and I’d spit in his face.’
Andrew and Mark turned their father in, ignoring his plea to them to give him 24 hours to get the family’s affairs in order before they alerted the authorities.
They say they never spoke with Bernie again after he confessed to what he had done.
Bernie’s house of cards came crashing down in 2008 when, all at once, his clients – suffering from the global financial crash – asked him for redemption. That was when he was finally forced to admit there was no money to give them
Charles Murphy and Annabella Murphy. (left) Charles invested his own client’s money with Madoff and lost everything. He killed himself in March 2017. Thierry Magon de la Villehuchet committed suicide after losing more than $1billion of his client’s money with Madoff
Their mother Ruth was the only person in the family who stuck by him.
Andrew was first diagnosed with cancer in 2003 but he treated it successfully. When it returned in 2011, he blamed the stress of his father’s crimes for his health deterioration. He died three years later in 2014.
Bernie’s younger brother Peter was also jailed for his role in the fraud but the Madoff sons, who worked in a different department of the company, were never charged.
Andrew was being investigated for tax fraud when he died but nothing came of it. Peter Madoff spent eight years in prison for his role in the scheme and was released last June.
In 2012, he pleaded guilty to one count of falsifying records and one count of conspiracy to commit securities fraud.
Mark Madoff with his wife Stephanie, left, before his father’s crimes were revealed. Mark killed himself on the second anniversary of his father’s arrest in December 2010. Andrew Madoff, right, on the Today show in 2011. He died from lymphoma in 2014. The two brothers said they never spoke to their father again after learning what he’d done
Mark Madoff was found hanging in his Manhattan apartment in December 2010. His wife blamed his father and the shame he felt over his crimes
In 2019, Ruth reached a settlement with some of her husband’s surviving victims to pay them $600,000.
It was a tiny fraction of the fraud he’d actually committed, but she said it was the best she could do with the limited resources she had been left.
In a 2011 interview with CBS, Ruth complained about the death threats she and Bernie had received when he was in bail and she revealed the pair tried to kill themselves on Christmas Eve, just 10 days after his arrest, by swallowing pills
When the FBI arrested Madoff, they froze and seized most of his assets but they let Ruth keep $2.5million for legal fees.
She has always maintained that she knew nothing of the fraud, despite doing the company books.
Madoff was arrested on December 11 then released on a $10million bond within days. On Christmas Eve that year, he and Ruth tried to kill themselves, she later said.
‘I don’t know whose idea it was, but we decided to kill ourselves because it was so horrendous what was happening,’ she told CBS 60 Minutes in 2011, complaining they’d been subjected to.
‘We had terrible phone calls. Hate mail, just beyond anything and I said: “I just can’t go on anymore.” ‘I took what we had, he took more. We took pills and woke up the next day…
‘It was very impulsive and I am glad we woke up,’ she said.
Ruth, according to friends of the family, lived in ‘fear’ of her husband. They had met as teenagers and he criticized everything about her, they said.
‘I always felt like I was going to be fired,’ she told a biographer of the family for a 2011 book.
Madoff’s wife Ruth fled Manhattan in exile after his arrest in 2008. She has been living quietly in Greenwich, CT, for the last several years. Friends have told how Ruth lived in ‘fear’ of her husband – he cheated on her for 16 years during their marriage but she never left him, even after his arrest
She was so paranoid he was going to cheat on her that she only allowed him to travel for 24 hours alone at a time.
It didn’t stop him; for 16 years, he had an affair with Sheryl Weinstein. She revealed their affair in a book, Madoff’s Other Secret.
Ruth said the affair that was ‘the most hurtful thing that ever happened to her’ in an interview in 2011, a year after her son Mark’s suicide.
Other biographies reveal how Bernie was a neat freak, so obsessed with keeping things clean that he didn’t allow shoes or dirty feet on his yacht, and how he kept his grandkids out of his Manhattan apartment.
He made inappropriate comments on his daughter-in-laws’ bodies, especially when they were pregnant, and relished in telling them that they weren’t ‘from money’.
How plumber’s son Bernie Madoff went from Wall St. demigod to Ponzi pariah after 2008 crash exposed his scam and saw him arrive at court in bullet-proof vest after ripping off the world’s richest
For decades, Bernie Madoff – a former chairman of the Nasdaq stock market – enjoyed an image as a self-made financial guru whose good fortune defied market fluctuations. But it all came crashing down in 2008 after his investment advisory business was exposed as a multibillion-dollar Ponzi scheme that eradicated people’s fortunes – both rich and poor
Bernie Madoff, the man behind the biggest and most devastating Ponzi scheme in history that robbed tens of thousands of victims worldwide of $65 billion, went from a high-flying Wall Street financier to living out his dying days in a North Carolina prison.
For decades, Madoff – a former chairman of the Nasdaq stock market – enjoyed an image as a self-made financial guru whose good fortune defied market fluctuations. He attracted a devoted legion of investment clients from Florida retirees to the rich and famous including director Steven Spielberg, actor Kevin Bacon and former New York Mets owner Fred Wilpon.
But it all came crashing down in 2008 after his investment advisory business was exposed as a multibillion-dollar Ponzi scheme that eradicated people’s fortunes – both rich and poor – and destroyed charities and foundations worldwide.
Madoff became so hated he had to wear a bulletproof vest to court after admitting to his crimes.
His death on Wednesday, while serving a 150 year prison sentence at Butner Federal Correctional Complex, brings an end to his scandal-plagued life that saw a very steep rise and tragic fall.
The epic downfall from his financial fraud not only destroyed the lives of his 37,000 victims but also that of his own family, including his two sons who ended up turning their father over to the authorities.
Madoff, who was born in 1938 in a lower-middle-class Jewish neighborhood in Queens, New York, became a legend in the financial world regarding the story of his rise to prominence.
His father, Ralph, was a stockbroker and plumber and his grandparents had emigrated to the US from Eastern Europe.
He and his brother Peter set off for Wall Street in 1960 with a few thousand dollars saved from working as a lifeguard and installing sprinklers.
Madoff studied political science and then law before starting Bernard L. Madoff Investment Securities. By 1980, his firm occupied three floors of a midtown Manhattan high-rise.
Initially, he – along with his brother – ran a business as middlemen between the buyers and sellers of penny stocks. His wife Ruth ran the books and his sons, once adults, went on to become executives.
Madoff raised his profile by using the expertise to help launch Nasdaq, the first electronic stock exchange, and became so respected that he advised the Securities and Exchange Commission on the system.
The Madoff’s palatial beachfront property in Montauk, Long Island. It was one of many homes the family owned
The Madoffs also had property in Palm Beach, Florida, that was paid for with other people’s money
The interior of Madoff’s private jet, where he wouldn’t allow any bags or luggage that had metal on the bottom or wheels for fear it would scratch the leather or paneling
But what the SEC never found out was that behind the scenes, in a separate office kept under lock and key, Madoff was secretly spinning a web of phantom wealth by using cash from new investors to pay returns to old ones.
Authorities say that over the years, at least $13 billion was invested with Madoff. An old IBM computer cranked out monthly statements showing steady double-digit returns, even during market downturns.
As of late 2008, before his arrest, the statements claimed investor accounts totaled $65 billion.
The ugly truth: No securities were ever bought or sold.
His clients, who included celebrities like famed film director Steven Spielberg, actor Kevin Bacon and Hall of Fame pitcher Sandy Koufax, said they had no idea.
Among them was Nobel Peace Prize winner and Holocaust survivor Elie Wiesel, who recalled meeting Madoff years earlier at a dinner where they talked about history, education and Jewish philosophy – not money.
Madoff ‘made a very good impression,’ Wiesel said during a 2009 panel discussion on the scandal. Wiesel admitted that he bought into ‘a myth that he created around him that everything was so special, so unique, that it had to be secret.’
Like many of his clients, Madoff and his wife enjoyed a lavish lifestyle.
They had a $7 million Manhattan apartment, an $11 million estate in Palm Beach, Florida and a $4 million home on the tip of Long Island. They also had another home in the south of France, private jets and a yacht.
But it all came crashing down in the winter of 2008 with a dramatic confession at Madoff’s 12th-floor apartment on the Upper East Side.
In a meeting with his sons, he confided that his business was ‘all just one big lie’.
They turned him in the following day.
A lawyer for the family contacted regulators, who alerted the federal prosecutors and the FBI.
Madoff was in a bathrobe when two FBI agents arrived at his door unannounced on a December morning. He invited them in, then confessed after being asked ‘if there’s an innocent explanation,’ a criminal complaint said.
Madoff responded: ‘There is no innocent explanation.’
He attracted a devoted legion of investment clients from Florida retirees to the rich and famous including director Steven Spielberg (right), actor Kevin Bacon (left) and former New York Mets owner Fred Wilpon
Among his victims was Nobel Peace Prize winner and Holocaust survivor Elie Wiesel (right) and former New York Mets owner Fred Wilpon (left)
As he had from the start, Madoff insisted in his plea that he acted alone – something the FBI never believed.
As agents scoured records for evidence of a broader conspiracy and cultivated Madoff’s chief financial officer, Frank DiPascali, as a cooperator, the scandal turned Madoff into a pariah, evaporated life fortunes and wiped out charities.
It also pushed some investors to commit suicide.
New York hedge fund executive Charles Murphy, whose fund lost $50 million in Madoff’s scheme, jumped from the 24th floor of the Sofitel New York Hotel in 2017.
French financier Rene-Thierry Magon de la Villehuchet killed himself in Manhattan in 2008 after losing more than $1 billion in the Ponzi scheme.
A trustee was later appointed to recover funds from Madoff’s scheme – sometimes by suing hedge funds and other large investors who came out ahead – and divvying up those proceeds to victims.
The search for Madoff’s assets ‘has unearthed a labyrinth of interrelated international funds, institutions and entities of almost unparalleled complexity and breadth,’ the trustee, Irving Picard, said in a 2009 report.
The report said the trustee has located assets and businesses ‘of interest’ in 11 places: Great Britain, Ireland, France, Luxembourg, Switzerland, Spain, Gibraltar, Bermuda, the British Virgin Islands, the Cayman Islands, the Bahamas. More than 15,400 claims against Madoff were filed.
Madoff pleaded guilty in March 2009 to securities fraud and other charges, saying he was ‘deeply sorry and ashamed.’
After several months living under house arrest at his $7 million Manhattan penthouse apartment, he was led off to jail in handcuffs to scattered applause from angry investors in the courtroom at his sentencing in June 2009.
‘He stole from the rich. He stole from the poor. He stole from the in between. He had no values,’ former investor Tom Fitzmaurice told the judge at the sentencing. ‘He cheated his victims out of their money so he and his wife… could live a life of luxury beyond belief.’
During the hearing, wrathful former clients stood to demand the maximum punishment. Madoff himself spoke in a monotone for about 10 minutes. At various times, he referred to his monumental fraud as a ‘problem,’ ‘an error of judgment’ and ‘a tragic mistake.’
He claimed he and his wife were tormented, saying she ‘cries herself to sleep every night, knowing all the pain and suffering I have caused.’
Like many of his clients, Madoff and his wife Ruth enjoyed a lavish lifestyle. They had a $7 million Manhattan apartment, an $11 million estate in Palm Beach, Florida and a $4 million home on the tip of Long Island. They also had another home in the south of France, private jets and a yacht
‘That’s something I live with, as well,’ he said.
Afterward, Ruth Madoff – often a target of victims’ scorn since her husband’s arrest – broke her silence that same day by issuing a statement claiming that she, too, had been misled by her high school sweetheart.
‘I am embarrassed and ashamed,’ she said. ‘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.’
About a dozen Madoff employees and associates were charged in the federal case. Five went on trial in late 2013 and watched DiPascali take the witness stand as the government´s star witness.
DiPascali recounted for jurors how just before the scheme was exposed, Madoff called him into his office.
‘He’d been staring out the window the all day,’ DiPascali testified. ‘He turned to me and he said, crying, ‘I’m at the end of my rope… Don’t you get it? The whole goddamn thing is a fraud.”
In addition to the tens of thousands of victims, the Madoff family also took a severe financial hit: A judge issued a $171 billion forfeiture order in June 2009 stripping Madoff of all his personal property, including real estate, investments, and $80 million in assets his wife, Ruth, had claimed were hers. The order left her with $2.5 million.
The scandal also exacted a personal toll on the family: His son Mark committed suicide in 2010, Madoff´s brother, Peter, who helped run the business, was sentenced to 10 years in prison in 2012, despite claims he was in the dark about his brother´s misdeeds.Madoff’s other son, Andrew, died from cancer at age 48.