Wow...wow...and holy shit (more on Madoff)

[XOM]

Jan. 8 (Bloomberg) -- Carl Shapiro’s name is chiseled into Boston’s largest academic and medical centers, testament to the roughly $80 million that he showered on the city in the past decade. Now it comes with a Bernard Madoff-sized asterisk.

Shapiro, a 95-year-old philanthropist, lost $545 million to Madoff, ranking him among the biggest individual victims of the world’s largest Ponzi scheme, data compiled by Bloomberg show. Now Boston, Carlo Ponzi’s adopted hometown, is bracing for the financial fallout.

“As a percentage of the population and significance of the charities involved, Boston was hardest-hit,” said Mark T. Williams, a professor at Boston University School of Management and a former Federal Reserve bank examiner. Shapiro “is Mr. Boston,” Williams said. “If Mr. Boston is hit, what do you think that does to Boston?”

Just as in Madoff’s base of New York, the alleged swindler targeted Boston’s wealthy Jewish families. Shapiro was atop the list. His 47-year-old namesake foundation, at 75 Park Plaza, lost $145 million because of Madoff. Shapiro and his wife, Ruth, are personally on the hook for about $400 million.

The foundation doled out most of its funds for new hospital buildings and cultural programs in Boston and Palm Beach, Florida, where the Shapiros also own a home. Harvard-affiliated Brigham and Women’s Hospital opened the Carl and Ruth Shapiro Cardiovascular Center last year. The foundation also pledged $27 million to the Dana-Farber/Brigham and Women’s Cancer Center as well as $15 million to Boston Medical Center for an ambulatory care center.

‘All Obligations’

The foundation says it plans to “fulfill all of its current obligations.” Shapiro didn’t return a telephone message left at his home.

He and his wife are the largest donors to Brandeis University in Waltham, 10 miles northwest of downtown Boston, giving more than $80 million to the nonsectarian Jewish- sponsored institution. The school didn’t invest with Madoff, according to spokesman Dennis Nealon.

For Shapiro, the financial pain may also have been personal. The first televised reports of Madoff’s scam were “a knife in the heart,” the Palm Beach Post quoted Shapiro as saying.

Shapiro gave Madoff $250 million 10 days before his arrest, the Wall Street Journal reported, citing unidentified sources. Madoff promised Shapiro he would get it back quickly and with interest, but never did, the newspaper said. The Shapiros have hired New York lawyer Steven F. Molo of Shearman & Sterling to represent them, the Boston Globe reported today, citing a family spokesman.

Harvard, Tufts

Institutions throughout Boston say they’re worried about future donations from groups that lost money by investing with Madoff. Several Harvard University-affiliated hospitals, the Massachusetts Institute of Technology, Tufts University, the Elie Wiesel Foundation for Humanity and a $40 billion state pension fund were exposed to Madoff through donations or investments.

Tufts said it lost $20 million by investing with Madoff through Ascot Partners LP, the New York fund run by J. Ezra Merkin. Merkin also faces a lawsuit from New York University, which said it had at least $24 million in losses after Merkin and his funds invested with Madoff.

“We knew the economy was in bad shape,” said George McCully, president of the Boston-based Catalogue for Philanthropy, which focuses on donor education. “But to have something like this come along, to have a guy in the for-profit sector cheat and steal others in the philanthropic sector, adds insult to injury.”

Looming ‘Void’

The $958 million Picower Foundation in Florida, which gave MIT a $50 million grant to fund the Picower Institute for Learning and Memory, plans to close because of losses at the hands of Madoff. Wiesel’s group lost $15.2 million.

Other institutions tied to Madoff include the Robert I. Lappin Charitable Foundation of Salem, Massachusetts, which was forced to close, ending trips for local students and teachers to Israel. Maimonides School, an Orthodox Jewish day school in Brookline, Massachusetts, lost $5 million, according to school board chairman Jeffery Swartz in a letter to parents.

Hedge fund Tremont Group Holdings Inc., part of Massachusetts Mutual Life Insurance Company, invested $3.3 billion with Madoff. MassMutual itself may have $10 million at risk, according to a company statement.

Shapiro made his fortune in the clothing industry as founder of Kay Windsor Inc. in New Bedford, Massachusetts, according to the Web site of his foundation. He sold it to the Vanity Fair Corp. in 1971 and remained with the company until his retirement in 1976, according to the site.

For Boston-area charities, the future remains murky, Williams said. “The bigger story going forward is, ‘Who will be able to step up to the plate and fill the void?’”

[Albert0373]

That's insane...working most of their lives for that money and ended up losing it.

Diversify =/

[freakscene]

holy shit is right

but what sort of retribution do they expect the courts to take for them?

is it possible Madoff has enough assets that they could recover some of their money ?

and, this really makes me wonder what Madoff must have thought of them. knowing he was about to go down, yet still asking for a quarter billion and promising a quick return with interest, knowing damn well it wasnt going to happen

they must not have been Madoff's favorite people

[XOM]

That's what gets me about this guy; on the one hand he seems like a ruthless con artist with no remorse, but on the other hand he was mailing watches and jewelry to friends and family and had 100 checks for almost $200M ready to send out. Why in the hell did he not square away all of that shit before he told his sons? Did he grossly underestimate his sons' willingness to help him hide this for a little longer?

I think he's long ago convinced himself that there was justification in doing what he did (perhaps his awareness of how slimy Wall street really is), otherwise we should be reading about his suicide and apparent remorse.

[Wookie]

Frankly an incredible story this is.

I simply cannot comprehend how such an Individual who had a successful career, plenty of money from working hard previously, a family, friends, good reputation, flying high - could literally put his entire life, family and friends into such a jeopardy.

Let alone get up in the morning, every morning and look at himself in the mirror.

It just does not compute at this end, simply does not!

[XOM]

I'm wondering if the jewelry, watches and $173M worth of checks isn't some ruse to make the Feds think that is all that is left? Why else would you blow the whistle on yourself before you completed your final transactions? Perhaps a much bigger stash in a deposit box somewhere.

[JV_Picker]

As the Madoff-related mess continues to shatter organizations and lives (Can't imagine what I'd do if most of my worth disappeared overnight while being too old to work: move to a decrepit neighborhood [where, if my city is an example, not a cheap place to live anymore] if I didn't own my house outright? Start buying stuff from Dollar Tree? Savor every SSI check coming in, even with expenses skyrocketing over income?), I feel a little more relieved that the more retail-oriented investment firms that deal with Joes like me seem to have stayed away from such scandals.

I think the private banking industry will take a second look at itself (hopefully) and be more transparent abut its dealings. I recall very few firms (if any) that manage equity for high net worth entities offering anything more than a phone number and/or address over the web.

[Stas1976]

Now probably every smart crook in town claims that s/he lost money on Medoff. It became a new way how to write down lost investors money. Very easy way to explain investors where is the monies.

Dialog:
Investor: "Where is my money dude ?"
Manager "O sorry, I gave them to Medoff. They now all gone..."

[MoreYummy]

Lets see the final total of this event. Could be less than he claimed. ;D

[Rich]

I wonder what his USERNAME was here?