And the Madoffs Continue to Impress

Both my parents graduated from Far Rockaway High School in Queens, NY back in the 1940s. So did Bernie Madoff and his wife, Ruth, who met there and were a few years apart, though they graduated a bit later in the 1950s.

If you go to the NYC schools website regarding FRHS, they list famous alumni: Richard Feynman, Burton Richter and Baruch Blumberg who are each Nobel Prize winners; Dr. Joyce Brothers, psychologist and television personality; Carl Icahn, financier; Audrey Pheffer, Assemblywoman; James Sanders, Jr., Councilmember; Nancy Lieberman, WNBA; Richard Berke, VP Human Resources ADP; and Marilyn G. Gelber, Executive Director, Independence Community Foundation.

Some amazing people came out of that place. I remember my folks coming North a decade or so ago to celebrate a major anniversary of the school with many old friends. Much has changed in the Rockaways, a seaside community on the south shore of Long Island (although Queens and Brooklyn are technically on Long island, for some reason we always refer to Brooklyn, Queens and Long Island as if they are something separate).

A strong Jewish community existed in the 1940s and 1950s when the Feldmans, Rivkins (my Mom’s family) and Madoffs were there. They mostly left into the 1960s, leaving a more urban population with increasing crime and other problems. Lately, orthodox Jews have been moving back to the area in droves. The house my Mom grew up in back in the 1930s on Cornaga Avenue is still standing. I can still remember going there as a child and enjoying my grandmother’s cooking.

Why does any of this matter? Why write this now? Well it does seem that Mrs. Madoff, FRHS ’55, may have had an inkling of bad things to come, as the Wall Street Journal just reported a few hours ago that she allegedly withdrew $15 million from their accounts in November and December just before hubbie Bernie allegedly made his startling revelation to his sons that he had engineered a $50 billion Ponzi scheme that was finally unraveling. I’m guessing, as successful as they were, if this is true, that this was not her normal allowance.

It matters because more and more stories are coming out about victim/friends. Victim/high school classmates. Victim/retirees on fixed incomes. And, it appears, his sons and brother were victims according to the sons. Allegedly, allegedly, allegedly.

We have heard more and more horror stories from his high school buddies, looking him up after all these years. They go to visit good old Bernie, hearing about his great investment prowess. He’ll get Ruth on the phone and they all say hi. Bernie apologizes but says the funds are full. The next day he calls back and says, great news, Ruth pressured me and we found a way to get you into the fund. Allegedly, allegedly, allegedly.

Swindling strangers is really bad. Swindling new friends is worse. Swindling the very people you grew up with, where that comfort level is at its highest (clearly for no reason), is the worst. This was not how things were done in the Rockaways.

And we are not done. I’m hearing about more and more Madoffian schemes coming unglued by the current economy. Some only involving a few measly million, some much bigger. And the Madoff claws grow bigger. Major non-profits in danger of disappearing. Universities losing multi-million dollar pledges that were to pay for buildings that have already been built. You name it. This story has only just started.

For the reverse merger crowd, well keep remembering that anyone you deal with in business has to be thoroughly checked out. Period.

A little on my current visit to Washington tomorrow or Friday….

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