shame of being a Madoff

 

In their first interview about the crimes of Bernard Madoff, the son and the wife of the man who scammed billions of dollars provide the first inside account from the immediate family. Ruth Madoff and son Andrew tell Morley Safer how Madoff confessed his crimes to them, their reaction and the subsequent family strife of the past three years. Web Extras Ruth and Andrew Madoff, pt. 1 Ruth and Andrew Madoff, pt. 2 The confession of Bernard Madoff More » (CBS News)  When news broke that Bernard Madoff had swindled thousands of people out of billions of dollars, many assumed that his family must have known all along. But Madoff's wife Ruth and son Andrew tell Morley Safer they were blindsided when Madoff finally confessed that he'd been running a giant Ponzi scheme. In their first television interviews, they describe how their once-happy family was completely destroyed.The following script is from "Madoff" which aired on Oct. 30, 2011 Madoff...It is a name that will live in infamy...It's been nearly three years since Bernard Madoff confessed to running a $65 billion Ponzi scheme - the largest financial fraud in history. Thousands of trusting clients who felt safe investing with a financial genius were swindled. He hadn't invested a penny. While Madoff is serving 150 years in prison, his family has had to deal with the consequences of his crimes. His wife Ruth, divested of most of her great wealth - and derided by a suspicious world. Their son Mark - dead. Driven to suicide by shame and accusations of guilt. Their other son Andrew isolated - trying to live with the disgrace.

Ruth Madoff reveals suicide pact after £40bn fraud

 

Come what may, Mrs Madoff is still managing to keep up appearances. But behind her designer outfit and reassuringly expensive haircut, she's anxious to remind the world that life as the spouse of a $65bn (£40bn) conman isn't always plain sailing. In her first interview since her husband Bernie oversaw the collapse of the family investment house almost two years ago, Ruth revealed the couple attempted suicide in the immediate aftermath of his arrest. It was the night before Christmas 2008. The Madoffs, once the toast of New York society, were confined to their Manhattan penthouse, coming to terms with the fact that his Ponzi scheme had wiped out the life savings of several thousand investors, including many close friends and family members. "I don't know whose idea it was, but we were both so saddened by everything that had happened that we decided to kill ourselves," she recalled. "It was so horrendous what was happening. Terrible phone calls, hate mail – just beyond anything. And I said, 'I just can't go on any more'." They decided to overdose on the sedative Ambien. But they apparently under-estimated the amount needed and found themselves still alive to face the music on Christmas Day. "We were both in agreement," she told CBS's 60 Minutes – which will air interviews with her and her son Andrew on Sunday. "I don't remember what we said very much. We were figuring out how many pills to take. "I think we were both sort of relieved to leave this place. It was very, very impulsive, is all I can say. And I was glad to wake up the next morning." The show will tell how the family learnt of their sudden elevation to global pariah status and explain what they have been doing since. Mrs Madoff, 68, met her husband, now 73, when she was 14 and married him two years later. At the height of their powers she kept an office at the headquarters of the family investment firm and was listed as a director of several companies he controlled. She has always maintained she had no idea the firm was overstating profits and defrauding investors. After his arrest she struck a deal with prosecutors that saw her give up all her assets except for $2.5 million. Many of Madoff's victims angrily insisted she should have been left with nothing. Shortly after the deal was announced, The New York Times dubbed her "the loneliest woman in New York". She later left the city to live in Florida. Judging by CBS interview footage released yesterday, the months since have been tough on a woman who was once the toast of Manhattan. She has retained her petite figure, well-groomed blonde hair and elegant dress sense but has aged considerably. Although she admits being initially supportive of her husband, visiting him in prison, she says she decided to break off contact last December. That was when their second son, Mark, 46, hanged himself on the anniversary of his father's arrest using a dog leash. It remains to be seen whether the TV interview will repair her tattered reputation. People who believe she helped cover up her husband's fraud now suspect her claim about their joint suicide bid was invented to win sympathy. Their former bodyguard Nick Casale, who was with them that Christmas Eve, cast doubt on the story yesterday. Bernie has also granted a first interview, it emerged last night. He spoke to the veteran TV interviewer Barbara Walters at the prison in North Carolina where he is currently serving a 150-year sentence for fraud. No cameras were allowed but a transcript suggests he expressed remorse for his crimes and understands why people think he "robbed widows and orphans". But he insisted: "I made wealthy people wealthier." And on life behind bars, he added: "Ruth not communicating is the hardest thing... Ruth doesn't hate me. She has no one. It's not fair to her. She lost her first so. She's a devoted wife and didn't care about the money."

A rogue art dealer who was jailed after netting £180,000 selling fakes was finally caught out when he sold a piece to an auctioneer who was a friend of the artist.

Jailed: Rahman, pictured outside Leicester Crown Court, sold fake fine art but was found out when he passed a forgery to an artist's friend

Rizvan Rahman, 40, tried to pass off a fraudulent copy of a work by Cornish artist Jack Pender to a local auctioneer.

But unknown to him the expert, David Lay, was a good friend of the artist, who died in 1998, and also happened to be an expert on all his works.

Realising it was a fake, he contacted the artists' son, Robin Pender, and together the two men researched Rahman's collection and passed their findings on to the police.

In December 2009, officers swooped on Rahman's home in Leicester and seized 19 paintings, some purportedly by Picasso, Francis Bacon and Lucian Freud.

He was arrested and sentenced to 18 months in prison at Leicester Crown Court earlier this month.

Mr Lay said: 'I've read that the famous auction houses like Sotheby's, Christie's and Bonham's were the ones who spotted this - but it was a Penzance boy.

'I just thought there was something not quite right.

'I knew Jack and I know Robin. Robin and I looked at some databases and realised there were between a dozen and 20 Jack Pender fakes doing the rounds.

'I was incensed, because it quickly became obvious I was dealing with a person who was trying to deceive me and he'd already deceived others."

Robin Pender said: 'It wasn't immediately obvious they were fakes.

 

 

'I can understand why people were taken in, but I could tell by a combination of things that they weren't Dad's.

'For example the shape of the boats, the style and the way the whole thing seemed over embellished.

'I'm really pleased we cleaned up the market, because people were being conned.'

Art show: PC Jason Helmn with an example of one of the fakes Rahman sold as an original

Rahman claimed the paintings were given to him by his father or that he had bought them to hang on his wall.

He sold 13 forgeries of work by Mary Fedden, described in court as one Britain's greatest living artists, whose Royal College of Art pupils included a young David Hockney.

Owners of galleries all over the country including Cornwall, London and Uppingham, Leicestershire, were initially taken in by the defendant.

Gordon Aspden, prosecuting, said: 'Between January 2008 and October 2009, Rahman defrauded galleries and members of the public by selling paintings he falsely claimed were genuine and original works of art.

'His motive was to make money at the expense of innocent purchasers and the amount involved was £179,450.

'When some of the frauds were discovered he would express surprise and refund the gallery involved.

'Taking refunds into account his net profit was at least £61,950.'

More than 30 fakes were sold through well-known auction houses and respectable galleries.

Mr Aspden added: 'He occasionally produced fake documents as proof of provenance.

'The forgeries were mainly in the style of post-war British artists including Jack Pender, Mary Fedden, Sandra Blow, Terry Frost and Wilhelmina Barns-Graham.'

Sentencing Rahman, Judge Ebrahim Mooncey said: 'It is clear that for nearly two years you were involved in defrauding members of the public, art galleries and artists.'

Rahman, a married father of three, who traded under the name of Haslam and Purdy, admitted two counts of fraudulent trading, eight counts of selling false works and two of possessing articles (documents) for use in fraud.

11 Charged in L.I.R.R. Disability Scheme

 

Eleven people were charged on Thursday in an enormous fraud scheme in which hundreds of Long Island Rail Road workers falsely claimed to have disabling injuries, with some of them collecting tens of thousands of dollars in annual pensions while spending time playing golf, law enforcement officials said. Enlarge This Image Robert Stolarik for The New York Times F.B.I. agents escorted Gregory Noone on Thursday. He was charged in a scheme involving Long Island Rail Road workers. Multimedia TimesCast | Disability Fraud Document L.I.R.R. Retirement Disability Fraud Complaint The Most Dangerous Job? Related Series A Disability Epidemic Among a Railroad’s Retirees (September 21, 2008) Retirees May Be Abusing Insurance, L.I.R.R. Says (October 8, 2008) Doctors Eased Path for L.I.R.R. Disability Claims (October 27, 2008) The Disability Board That Couldn’t Say No (December 15, 2008) Times Topic: Long Island Rail Road Related in Opinion Editorial: Railroads and Rubber Stamps (October 28, 2011) Connect With Us on Twitter Follow @NYTMetro for New York breaking news and headlines. Enlarge This Image Robert Stolarik for The New York Times A complaint filed in the case said Steven Gagliano, who claimed disabling back pain, went on a 400-mile bike tour. Readers’ Comments Share your thoughts. Post a Comment » Read All Comments (473) » The fraudulent payouts in the scheme, officials estimate, could end up costing a federal pension agency more than $1 billion if fully disbursed. Ten of the defendants were taken into custody early Thursday at their homes by agents from the Federal Bureau of Investigation and state investigators, officials said. They included seven former railroad workers, including a former union president; a former federal railroad pension agency employee who helped the workers file claims; a doctor; and a doctor’s office manager. A second doctor is expected to surrender on Friday. The United States attorney in Manhattan, Preet Bharara, said, “Employees, in many cases, after claiming to be too disabled to stand, sit, walk or climb steps, retired to lives of regular golf, tennis, biking and aerobics.” The charges involving the railroad come at a time when public workers’ unions across the country have faced heavy criticism for negotiating pension obligations that led many government agencies to slash services and lay off teachers, police officers and other workers. A sampling of hundreds of cases approved by two doctors showed that $121 million had been paid to workers whose disabilities were either fabricated or exaggerated, according to court papers, though the total was quite likely more. It was unclear if officials would try to stop the payouts, or could even legally do so, before the disbursements hit $1 billion. The federal investigation followed reporting by The New York Times for a series of articles published in 2008 that revealed systematic abuses of federal Railroad Retirement Board pensions by Long Island Rail Road workers. The claims of disability made by the seven people charged with obtaining their pensions fraudulently contrasted sharply with their lifestyles, according to court papers. One of the defendants, Gregory Noone, 62, of East Islip, N.Y., who receives $105,000 in pension and disability payments each year, plays tennis several times a week and played golf 140 days over the course of one nine-month period, despite his reports that he had severe pain when gripping objects, bending or crouching, the complaint filed in the case said. Another defendant, Regina Walsh, 63, a railroad office worker who lives in New Hyde Park, N.Y., collects $108,000 a year in pension and disability payments; she had complained of significant neck, shoulder and hand pain caused by sitting at a desk and using a computer, and leg pain caused by standing for more than five minutes. But surveillance showed her shoveling snow for over an hour and walking with a baby stroller for 40 minutes, the complaint said. And a third defendant, Steven Gagliano, 55, of North Babylon, N.Y., who receives more than $75,000 in payments annually and claimed to be suffering from severe and disabling back pain, went on a 400-mile bike tour around New York State, the complaint said. The complaint, 74 pages long, said that “the fraudulent scheme could cause the R.R.B. to pay unwarranted occupational disability benefits exceeding $1 billion dollars if disbursed in full.” Federal prosecutors and the F.B.I. were helped in the investigation by inspectors general from the Railroad Retirement Board and the Metropolitan Transportation Authority, the parent agency of the Long Island Rail Road. Nine defendants appeared on Thursday before United States Magistrate Judge Theodore H. Katz in Manhattan; eight were released on personal recognizance bonds. A ninth defendant was taken to a hospital after becoming ill. The 10th defendant is to appear on Friday. Each defendant faces a maximum of 20 years in prison if convicted. The Times articles reported that virtually every career employee of the railroad was applying for and receiving disability payments, giving the Long Island Rail Road a disability rate three to four times that of the average railroad. The Long Island Rail Road, unlike any other commuter railroad in the country, allows workers to collect an early pension, in some cases at age 50, which they can supplement with disability pensions from the federal railroad agency. The Times found that retired railroad employees who had successfully claimed disability were regularly playing golf at a state-owned course without charge — another perquisite of their disability. Indeed, the railroad’s retirement rate was particularly striking when compared with the number of disability pensions at Metro-North Railroad, another subsidiary of the transit authority that serves commuters to New York City with a work force of similar size and composition. Investigators involved in the case said they brought charges only in cases with the strongest proof and the most egregious instances of fraud. But in a news conference on Thursday, officials gave a warning to railroad retirees with knowledge about any continuing disability fraud.