Madoff family ‘was innocent’

Alexandra Frean

BERNARD Madoff’s wife and sons were unfairly pilloried by the media after his arrest in December 2008, even though it was highly unlikely they knew he was running a huge Ponzi scheme, a book claims.

Diana Henriques, of the New York Times, who covered the case and who has interviewed Madoff in prison, suggests, however, in The Wizard of Lies that the late billionaire philanthropist, Jeffry Picower may well have suspected Madoff was a fraudster but decided to play along with it for his own benefit.

Madoff, 71, is serving a 150- year prison sentence after pleading guilty to a $65-billion (R433-billion) scam spanning decades in which he used money from new clients to pay off old ones. He has denied that anyone else at his firm, including his sons, Andrew and Mark, had any knowledge of the fraud, but in an interview with Henriques he suggested that “Picower was the only one that might have [known].”

The book details how Picower, who was found dead in his swimming pool in October 2009, having drowned because of a heart attack, invested $620-million (R4-billion) with Madoff over the years, but later withdrew billions.

Madoff allowed the withdrawals to continue, the book suggests, because Picower had become the Ponzi equivalent of a bank too big to fail – an investor too big to shoo off. Madoff realised he could never pay out all of Picower’s paper profits and so played along with him.

Picower was never charged with any crimes before his death, but in December his widow agreed to pay a $7.2-billion (R48-billion) settlement to help to compensate victims of Madoff’s fraud.

The book comes as close as possible to exonerating the secretive Madoff’s widow, Ruth, and his sons.

Mark Madoff committed suicide in December. – The Times, London

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