|Excuse me are you listening? 7-25
Sunday, January 4, 2009
I'm upset. I'm actually livid right now. Reality sets in when you realize that there's a person who ruined the lives of thousands if not millions. The atrocities that he dealt demands a special assembly, a call for action, a verbal uprising, a civil march or something cataclysmic.
This cruel, insensitive man is 70-year-old Bernard “Bernie” Madoff (pronounce MADE-OFF). He “made off” with 1 life and 50 billion dollars ($50,000,000,000) so far. In my opinion, he's a murderer and a thief. He swindled both the extremely rich and the extremely poor.
Madoff was arrested by federal authorities on December 11, 2008 and charged with securities fraud for allegedly running a Ponzi scheme. He paid one set of investors with money from another. He's currently under house arrest and still lives in his $7 million dollar Park Avenue apartment instead of being in jail. Hmm. There's overwhelming evidence that he committed the crimes. Hmm. Yes, he confessed. He told his 2 sons. His bail should have been denied!!!
He has to wear an electronic monitoring device and has a curfew from 7 p.m. to 9 p.m. I'd like to steal a loaf a bread and claim hunger. I'd not be on an electronic device in my home. I'd be in jail. You'd be in jail, dipping stale powdered donuts in cold coffee for breakfast.
According a press release from The Securities and Exchange Commission, Bernard L. Madoff and his investment firm, Bernard L. Madoff Investment Securities LLC, was charged with securities fraud for a multi-billion dollar (50 BILLION DOLLARS) scheme that he perpetrated on clients of his firm.
What? 50 billion dollars? let me see… Hmm, what could I possibly buy with that kind of money? I think I smell my cerebellum on fire just of the mere thought of attempting to spend that. Oprah Winfrey is worth 2.7 billion dollars according to Forbes. She makes more than Ted Turner, the Meijer family, Gordon Getty and George Steinbrenner III. Combined they all give to charity and appear to have a gazillion dollars but combined they don't make anywhere near 50 billion a year.
The state of Michigan is slated to spend $44 billion dollars in 2009 on its budget. There are 10 million people living in our state. A whole state!!! To understand the gravity and depth of the Madoff scandal, our state spends 6 billion less than what Madoff allegedly stole from his clients.
Below details the amount to be spent in 2009: K-12 Education,$13.4 billion; Health Care,$12.5 billion; Human Services, $4.5 billion; Transportation,$3.4 billion; Higher Education, $2.1 billion; Corrections, $2.0 billion and State Police, $0.5 billion.
The remaining 6 billion dollars covers the legislature, judiciary, agriculture, attorney general, secretary of state, civil rights, environmental quality, natural resources, economic development, management and budget, military & veterans affairs, history, arts & libraries, the treasury and revenue sharing for local communities.
One of Their Own
The interesting point about Madoff is that he's Jewish and most of those who he allegedly stole from are Jewish as well. Sociologically speaking, this isn't a normal occurrence among the Jews. There are deep cultural bonds and extreme mutual respect due to their sense of their religious, cultural and familial bonds. Madoff's name is now rolling off of the tongues of many who would like to strangle him but have kept their searing words private.
What Madoff is accused of is an “affinity crime”. He used his ethnicity and social ties to identify and exploit his targets. An editorial in the New Jersey Jewish News states, “It's important to point out that Madoff was an equal opportunity predator, harming Jews and non-Jews alike. But there's no doubt he built his reputation, like his pyramid scheme, on a base of Jewish marks.”
Madoff used his friends to exploit their families and business associates by involving them in his elaborate scheme. They trusted him in synagogues, yacht clubs, the private circles and boardrooms. This was a worldwide operation. The close-knit group of his rich and famous clients is beginning to unravel like a dryrotted sweater. The promise of great returns made it easy for him to take advantage.
Shattered Lives, Fallen Fortunes
One of his close friends, Thierry Magon de La Villehuchet committed suicide over losing a purported $1.5 billion dollars. He took sleeping pills and slit his wrists. His deliberate act of putting a trash can by his body to catch the gushing blood should be enough to express the shame and guilt he felt for involving his clients with Madoff.
Oh yes, Mr. Madoff, you're the murderer of dreams for many. December 2009 will be a month that many Jews will not forget. Madoff destroyed many lives and only the strong will be able to survive the true aftermath. We may not hear about the full depth of Madoff's madness. Somewhere along the way Madoff became lost and his greed unleashed financial tremors that will reverberate around the globe for quite some time. I'm beginning to believe that he has been the master puppeteer of our banking and financial collapse.
Unapologetic, he sits in his apartment I wonder if he thinks about the indescribable heartwrenching pain that his friend's wife is feeling. Her husband committed suicide. It's truly disturbing.
Gifting circles, Ponzi schemes, pyramids schemes usually take place in trusting circles. The excitement of making easy money encourages people to get others involved which more than likely includes family, close friends and neighbors. This situation was extremely strange and bizarre because the majority of Madoff's clients were supposed to be financially savvy themselves. I guess the lure of the great return fueled some investors greed as well.
I recently had a friend who e-mailed me about a “gifting circle”. I strongly advised her against it. These schemes come in all different packages and when you unwrap them the box is empty.
The Ultimate Impact
If you’re at all thinking that what Madoff did doesn't affect you, think again. Many foundations have been wiped clean of all of their money after years of doing great deeds. They trusted Madoff enough to allow him to invest a large portion of their money if not all of it. The foundations that lost money were helping some of the most desperately ill and poor across the country. From programs that taught tolerance to programs that helped ex offenders get back on their feet.
In October of 2007, the Picower Foundation in New York City awarded Beth Israel Deaconess Medical Center, a Harvard teaching hospital and a leading medical institution, Diabetes Research's unit $2.85 million in the area of diabetes and metabolism research.
According to The American Diabetes Association, compared to the general population, African Americans are disproportionately affected by diabetes:
• 3.7 million, or 14.7% of all African Americans aged 20 years or older have diabetes.
• African Americans are 1.6 times more likely to have diabetes as non Hispanic whites.
• 25% of African Americans between the ages of 65 and 74 have diabetes.
• 1 in 4 African American women over 55 years of age has diabetes. African Americans with diabetes are more likely to develop diabetes complications and experience greater disability from the complications than white Americans with diabetes.”
Picower Foundation gave a $50 million gift to MIT specifically for brain and cognitive research. The research assisted MIT's drive to discover the intricate functioning of the brain, and the malfunctions involved in schizophrenia, memory loss, Alzheimer's, Huntington's disease and other brain disorders. It was the single largest gift given to MIT by a private foundation in the university's history.
According to the Associated Press, Barbara Picower of The Picower Foundation wrote in a statement that Madoff's "act of fraud has had a devastating impact on tens and thousands of lives as well as numerous philanthropic foundations and nonprofit organization."
Picower Foundation stopped all granting and also stated that they will be closing their doors.
Elie Wiesel Foundation for Humanity had $15.2 million invested under management with Bernard Madoff Investment Securities. This represented most of the foundation's assets.
According to their website, Elie Wiesel and his wife, Marion, established The Elie Wiesel Foundation for Humanity soon after he was awarded the 1986 Nobel Prize for Peace. The Foundation's mission, rooted in the memory of the Holocaust, is to combat indifference, intolerance and injustice through international dialogue and youth-focused programs that promote acceptance, understanding and equality.
Let's take a look at the JEHT Foundation that recently closed it's doors. To understand the magnitude of this you have to see that it will affect us. These are some of the organizations that will no longer be receiving much needed funds. It's impossible to list all of them but I felt the need to list some taken directly from their website:
American Prosecutors Research Institute, New York, NY - $183,687
Baptist Community Ministries, New Orleans, LA - $390,000
Bazelon Center for Mental Health Law, Washington, DC - $493,162
Brown University: Center for Alcohol and Addiction Studies, Providence, RI - $355,937
Center for Traumatic Grief and Victim Services, Moorestown, NJ - $75,000
Citizens Alliance on Prisons and Public Spending, Lansing, MI - $490,000
Community Foundation of Southeast Michigan, Detroit, MI - $510,000
Council of Michigan Foundations, Grand Haven, MI - $20,000
Dallas County District Attorney's Office, Dallas, TX - $454,000
Death Penalty Information Center, Washington, DC - $125,000
Families Against Mandatory Minimums, Washington, DC -$500,000
Innocence Project, New York, NY - $2,250,000
Michigan Council on Crime and Delinquency, Lansing, MI - $300,000
Michigan Public Health Institute, Okemos, MI - $334,300, $197,154 and $280,000
Pacific News Service, San Francisco, CA - $50,000
Public Policy Associates, Lansing, MI - $67,500 and $1,694,914
Wisconsin Court System, Director of State Courts Office, Madison, WI - $537,000
We'll provide complete links on www.tncp.net. Also the monies listed are for different years; for example, a company listed above may have received the funds in 2005. Nevertheless, the funds were earmarked to help organizations help others.
Above is just a small fraction of the monies given to worthy organizations. In press release by Robert Crane, President of the JEHT Foundation he stated:
“The JEHT Foundation, a national philanthropic organization, has stopped all grant making effective immediately and will close its doors at the end of January 2009. The funds of the donors to the Foundation, Jeanne Levy-Church and Kenneth Levy-Church, were managed by Bernard L. Madoff, a prominent financial advisor who was arrested last week for defrauding investors out of billions of dollars.
The Foundation was established in 2000. Its name stands for the values it holds dear: Justice, Equality, Human dignity and Tolerance. It supported programs that promoted reform of the criminal and juvenile justice systems; ensured that the United States adhered to the international rule of law; and work to improve the voting process by enhancing fair representation, competitive elections and government transparency.
The JEHT Foundation Board deeply regrets that the important work that the Foundation has undertaken over the years is ending so abruptly. The issues the Foundation addressed received very limited philanthropic support and the loss of the foundation's funding and leadership will cause significant pain and disruption of the work for many dedicated people and organizations. The Foundation's programs have met with significant success in recent years - promoting change in these critical areas in partnership with government and the non-profit sector.”
The JEHT Foundation has lost its money and 24 employees are unemployed. It will close at the end of January 2009.
Even though the Securities Exchange Commission (SEC) is seeking emergency relief for investors, including an asset freeze and the appointment of a receiver for the firm, most likely the funds are gone.
According to the New York Post, a recent ruling by Judge Burton Lifland, a US Bankruptcy Court judge approved a plan by the Securities Investor Protection Corp. (SIPC) to only compensate victims with a maximum outlay of $100,000.00 in case. Judge Lifland's ruling also stated that victims are entitled to no more than $500,000 worth of securities from the SIPC. The $100,000.00 cash figure is included in the $500,000.00 maximum investors can get.
The freeze of Madoff and his firm's assets significantly affected businesses around the world and a number of charities, some of which, including the Robert I. Lappin Charitable Foundation website which taught Jewish children about their culture and religion. Their foundation has closed too and 1 page proudly lists the organizations that they have helped.
Others like Hollywood filmmaker Steven Spielberg and Liliane Bettencourt, the world's wealthiest woman allegedly are among the victims. Eric Roth the award-winning screenwriter of "Forrest Gump" and the recently released movie "The Curious Case of Benjamin Button" and is suing his Beverly Hills investment manager for investing and losing all his money in Madoff's scheme.
Mark Charendoff, president of the Jewish Funders Network is quoted on ejewishphilanthropy.com as saying: “It's an atomic bomb in the world of Jewish philanthropy; there's going to be fallout from this for years.”
Many of the foundations that entrusted millions of dollars to Madoff are now gone. The list will continue to grow as the shield of secrecy begins to erode. A once powerful man is being pushed and shoved by journalists. None of his friends are willing to come to his aid.
The Jewish community was preparing for Hanukkah, the Jewish celebration of national survival and religious freedom, that began at dusk on December 21, 2008, 11 days after Madoff's arrest. Jews around the world lit the first candle during the 8 day long celebration, which ended on December 28, 2008. The menorah and its 8 candles has become a symbol of a time when Jews needed spiritual strength and perseverance.
The message of the prophet Zachariah in the Hanukkah story is “Not by might, not by power, but by my spirit,” as the Jews fought what seemed like indefinite challenges and enemies. They continued to fight until they won.
This Hanukkah may the lights be your guide through these dark times. The light that was supposed to last only 1 day, lasted for 8 days. Just as God performed miracles for the Jewish people ages ago, I believe that God has some wondrous miracles left to perform.
Love and Light Always,
P.S. Remember to be wise!
P.S.S. This would be a good time to read about Jewish culture, especially Hanukkah. If you learn one new thing it would be phenomenal. I challenge you to read a book on world religions.