Last week I posted a piece on the Corporate Justice Blog about affinity fraud and the Bernie Madoff scandal. Well, the drama surrounding Bernie Madoff does not cease. A couple of days ago, Ruth Madoff, the wife of Bernie Madoff, was a major item in the news.As it turns out, Irving Picard, theTrustee appointed to liquidate Bernie's business assets filed suit against Ruth Madoff to recapture and recoup upwards of $45 billion transferred to Ruth Madoff, or companies she controlled, for her own personal benefit. In his Bankruptcy Court filing, Mr. Picard detailed 111 alleged fraudulent transactions and conveyances to Ruth Madoff.
As part of his 150 year sentence, Bernie Madoff forfeited most of his personal assets. The government did not contest Ruth Madoff's claim to $2.5 million. Ruth Madoff continues to enjoy substantial advantage and a relatively lavish lifestyle compared to the individuals and charities that were defrauded by Bernie Madoff, her husband.
The sins of the father are often the sins of the son/daugther. Are the sins of the husband the sins of the wife? This remains to be seen. Will Ruth Madoff have to atone for Bernie's sins? We shall see. Will we ever sort out the Bernie Madoff money trail? We'll find out. I'll keep you posted.
As a former SEC enforcement attorney I can tell you that the usual case is that most of the money generated in a ponzi scheme is forever gone, as the promoter basically knows the good times are going to come to an end and therefore has huge incentives to spend lavishly on an intoxicating life of luxury frivolity.
ReplyDeleteIn other words the money is gone.