“This answer did not make him happy,” Portnoy noted years later. “He felt that if someone was doing more poorly than he, it should be shown—or, better still, just don’t show anyone with a batting average under .200. The incident showed that Bernie did not appreciate negative publicity.”
Bernie did a bit better on the basketball court. The eighth-grade team on which he played won the school championship. Bernie and Elliott Olin were the best players on the team, according to Portnoy, who supplied the popcorn for the fans.
Because his chum Olin was involved in so many school activities, Bernie joined in, too. He served as a monitor, essentially a crossing guard, and proudly wore a white Sam Brown belt that went across his right shoulder and around his waist. As a monitor he was part of a small group of boys who kept discipline in the schoolyard. Bernie also followed Elliott into the Boy Scouts of America—their troop met at the Jewish War Veterans building in Laurelton—and both stayed in scouting through high school.
Bernie had proudly taken the Boy Scout Oath the day he joined:
“On my honor I will do my best to do my duty to God and my country and to obey the Scout Law; To help other people at all times; To keep myself physically strong, mentally awake, and morally straight.”
The first scout law that Bernie pledged to uphold was trustworthiness:
“A scout tells the truth. He keeps his promises. Honesty is part of his code of conduct. People can depend on him.”
The Alperns—Saul, an accountant who had the demeanor of a college professor, and Sara, trained as a social worker, and their two pretty daughters, Ruth and Joan—moved to Laurelton from Brooklyn when Bernie was starting seventh grade and his future wife was beginning fifth grade.
Ruthie, blonde and green-eyed, had a sweet nature and a keen sense of style even at her young age. Immediately, she bonded with another neighborhood girl, Jane Silverstein, the equally blonde and cute daughter of a men’s clothing manufacturer. Jane’s father had chosen to move to Laurelton because it was on the train line to Penn Station, which was near his office in the garment district. Jane, whose family had also moved to Laurelton from Brooklyn, was a year older than Ruth and lived two blocks away. The only difference between Jane’s cookie-cutter house and Ruth’s was that the Alperns had a sunroom in back.
They were two very bright and pretty little girls whose lives would intertwine through the years.
The Silverstein girl, who lived on 227th Street, had gotten to know the Madoff boy, who lived on 228th Street, before Ruthie Alpern had moved to the neighborhood, on 229th Street. “Bernie was a year older,” she recalls,“and he came to visit with some boys to see this girl who lived down the block who was his age, and that’s when I first met him. He was a popular kid, and he and Elliott Olin were very, very good friends.”
Ruth and Jane were good friends from fifth through eighth grade at P.S. 156.
“We were all part of a group. Ruth was a very likable girl who was smart, not bossy, and a good athlete.”
She also had a prescient sense of style. Few if any Laurelton girls were decorating their own rooms. But Ruthie Alpern had the ability, the creativity, and the family money to do it.
“Her mother actually gave Ruth a budget and she was allowed to decorate her own room, which was really forward thinking,” remembers Jane Silverstein Kavanau, Joe Kavanau’s wife of some 50 years. “Ruth picked out nice things. She had very good taste, innate good taste. She always looked good.”
(Years later, as Mrs. Bernie Madoff, Ruth would be intimately involved in not only her husband’s business affairs, but also in the decorating of their many fabulous properties.)
For several summers, the two girls, Ruthie and Jane, went to an eight-week camp together, and were bunkmates. “I had gone to the camp for many summers and somehow or other Ruth found it interesting because I was so enthusiastic about it,” says Jane Kavanau. “She spoke to her mother, and they met with the camp director and her parents decided to send her.”
The camp was not inexpensive, but the Alperns could well afford it. Saul Alpern had a knack for making money and generating clients. Down the road, he would become one of Bernie’s unofficial first feeder funds.
During Ruth’s first summer at coed Camp Adventure, on the shores of Great Pond in bucolic Ridgefield, Connecticut, she set her sights on a boy, but not just any boy. His name was Bobby Dworsky and he was the son of the camp’s owners, Bill and Ida Dworsky. Ruth, who would next set her sights on the Madoff boy, knew instinctively back then that it was important to be with a powerful male; in this case it didn’t hurt that as the owners’ son, Bobby had the run of the place, and Ruth was able to benefit from his perks. Ruth and Bernie—they’d be known that way as a team throughout their lives together—had not yet set each other’s hearts aflutter, so the Dworsky boy was Ruth’s boyfriend at camp.
The girls’ last summer together at camp was in 1954, beginning a slight hiatus in their relationship because Jane left P.S. 156 to commute to a private day school on Long Island called Woodmere Academy, where she’d complete her high school education and meet her future husband. They’d pick up again when both were young marrieds.
Bernie and Ruth, meanwhile, had seen each other around P.S. 156, but being two years younger, she wasn’t of much interest to him romantically. He had also gotten to know her because their fathers had become friends—their talk about money and how to make it being one of Saul Alpern’s and Ralph Madoff ’s mutual interests.
Unlike many of the other Jewish and Italian girls at P.S. 156 who possessed stereotypically ethnic features, the Alpern girl had a blonde, WASPy look about her—the flaxen hair, fair skin, and green eyes. In today’s world she’d probably be an Abercrombie & Fitch or Ralph Lauren girl, but with one big difference—an identifiable Queens accent. She looked nothing like either of her parents, neither of whom were especially attractive. Ruth’s older sister, Joan, was pretty, but not on a par with her sibling.
Jane Kavanau remembers a day when she and Ruthie went to buy some candy at Hamils on Merrick Road, and the proprietor was shocked—shocked—to learn she wasn’t a gentile because of her goyish look.
“The person who owned the candy store asked her, ‘Why are you wearing that?,’ pointing to the little gold Star of David she wore on a delicate chain around her neck. So Ruth said, ‘What do you mean?’ He said, ‘Why are you wearing that Jewish star?’ And Ruth said, ‘Why shouldn’t I?’ He said, ‘But you’re not Jewish!’ But she was of course.”
Years later, remembering those days, Kavanau notes that Ruth Alpern “looked like a shiksa. She did, absolutely. I did also but not as extremely shiksa-looking. Ruth and I used to mix our blonde hair together and you couldn’t tell whose hair was whose. We used to kid around. We had long hair and we would make ponytails and mix them together and they’d all look the same color.”
Ruth had several attributes going for her when she and Bernie started seriously dating when she was a freshman in the class of 1958 at Far Rockaway High School and Bernie was a junior. She had the shiksa look, but was Jewish; she was very social and outgoing, which was the opposite of him; she had a fashionista’s sense of style—very preppy; and her father, Saul, was a shrewd and creative accountant who always had his eye on the dollar. Beyond that, Ruth herself was bright, and was a whiz at one particular subject in school. And that subject was math. She knew her numbers and how to work them.
Ruthie Alpern had all the right stuff for a fast-track operator like Bernie Madoff, who had dreams of becoming a Master of the Universe in the gilded canyons of Wall Street.
Chapter 3
Bernie Hobnobs with the Wealthy, Strong-Arms Some Pals, and Courts “Josie College”
Bernie Madoff had a choice of two public high schools after graduating from P.S. 156 in June 1952—Andrew Jackson or Far Rockaway, both of which were in the Laurelton district. With his mediocre grades, he never would have made the cut for the elite public secondary schools such as the Bronx High School of Scien
ce, or Brooklyn Technical, where his brother, Peter, would be accepted.
Bernie chose Far Rockaway primarily because it attracted a relatively affluent, fast-track crowd. The other option, Andrew Jackson in St. Albans, Queens, was garnering a reputation as a Blackboard Jungle sort of school.
As Jay Portnoy, who commuted on the 20-minute train ride to Far Rockaway with Bernie and Elliott Olin, observed, “St. Albans was becoming New York City’s first suburban American black area,” drawing kids from poor neighborhoods, “which scared many of Laurelton’s liberal Jewish parents.”
However, many of those same parents, like Ruth’s, had low-paid black maids—schwartzes, they called them—working either full-time or part-time in their homes.
“They were bringing young girls, young black women up from the South to work in the houses,” says former Laureltonian Marion Dickstein Sherman, a doctor’s daughter, whose family had a live-in black maid. Sherman, who was a classmate and sorority sister of Ruth’s, observes, “Andrew Jackson was getting a little scary. It was low-income, scary black.” But she points out that the decision for her to go to Far Rockaway had nothing to do with any form of discrimination, just perceived danger. “That was the feeling.”
Bernie’s four years at Far Rockaway were for the most part uneventful, except for his social climbing.
Just like he bonded with popular Elliott Olin at P.S. 156, the likable kid from Laurelton began rubbing shoulders in high school with rich kids from the more affluent Rockaway Peninsula oceanfront communities of Neponsit and Belle Harbor. Bernie appeared to have a preternatural ability to move in moneyed circles even in his youth.
Money, and making it, was the gospel he had heard at home from his parents. Their indoctrination had taken hold. Bernie knew that to be a success he needed to move among the affluent.
In that well-to-do Far Rockaway crowd, he became close friends with Cynthia Greenberger and her high school steady and future husband Michael Lieberbaum, an honor student in math. Greenberger’s wealthy family would later invest big money with Bernie when he started his company right out of college, and they would lose big money in his Ponzi scheme. At the same time, Lieberbaum’s father, who became incredibly wealthy virtually overnight as a stockbroker, would play a key—and very questionable—role in generating business for Bernie in his early days.
At Far Rockaway High, Bernie was laying the groundwork—dotting the i’s and crossing the t’s, as it were—for his future.
One thing was for certain, though: He wasn’t an academic wizard. Bernie’s high school performance was unexceptional, and at best he was a C student.
“Bernie was not the brightest bulb,” recalls Far Rockaway classmate Mike Gandin, who became an attorney and a Madoff victim.
After Bernie was branded the “Ponzi King” by the tabloids, two other classmates, John Avirom, who was on the swim team with Bernie and became an immigration lawyer, and Peter Zaphiris, who became a businessman, got in touch and reminisced about the Bernie they remembered.
“When the shit hit the fan,” says Zaphiris, “I e-mailed Johnny to chuckle about what happened with Bernie, because we’d carry on in school about how he was the dumbest white man we ever met in our lives—excuse me for the pejorative. It’s not fair to say he wasn’t bright. The guy was a dummy in high school. If you said, ‘Hey, Bernie, how are you?’ his head would tilt to the side—he had a nervous tick—he’d squint, one eye would flutter, and he’d grunt,‘Hello.’ He was rather laconic, didn’t have much to say, never told a joke or said,‘Look at her—she’s some piece of ass,’ or anything like that. That was pretty much Bernie. He was just no place.”
Or so it seemed.
Fast-forward to one afternoon in the summer of 2008, as Bernie was scrambling to raise big money in a last-ditch effort to avoid getting caught. Zaphiris ran into him strolling in Manhattan’s Central Park.“I said, ‘Bernie, how’re you doing?’ And he pulled up his sleeve and he’s got two gold Rolexes on his wrist—the same wrist—and I said,‘Bernie, how come you’re wearing two watches?’ So he still blinks like hell and he leans over and he talks out of the side of his mouth and he says, ‘I gotta know what time it is in my London office.’Think about that. He couldn’t do the addition and the subtraction” to determine the time difference across the pond.
In the sleek offices of Bernard L. Madoff Investment Securities, where Bernie often boasted of the computerized high technology with which he supplied his traders, he barely knew how to Google, or send and receive e-mail. He thought a BlackBerry was a dessert. It was hard to believe, but true. This was the same self-proclaimed Wall Street wizard who had always claimed he came up with the idea for computerized trading. A former employee who helped co-workers with computer problems set up Bernie’s PC as if for a newbie: It was always turned on, it gave him only limited business news that any stay-at-home-mom day trader had access to, and if a minor glitch occurred that a computer-savvy seven-year-old could easily have fixed, Bernie acted as if the World Wide Web had been knocked out by the Taliban. He’d get stressed, and would call for immediate help.
All of which caused friends who thought of Bernie at Far Rockaway High as a “dumb schmuck” to wonder years later how in the world he was able to pull off his amazing fraud all on his own—as he claimed when he pleaded guilty.
“That’s what Bernie disdained most. He didn’t want to be a schmuck, but he really was,” observes Cynthia Greenberger Lieberbaum’s younger brother, John, who years later as a screenwriter, novelist, and software entrepreneur changed his last name to Maccabee. After Bernie was busted, Maccabee wrote an article for New York magazine in hopes, he says, of getting a deal to write a memoir or a novel about his family—an article that angered the Greenbergers and the Lieberbaums because he revealed that the two families clearly had connections to the world’s biggest crook.
“Obviously my sister and my brother [Washington, D.C.- based former Wall Street Journal Supreme Court reporter Robert Greenberger] are not responding well to the piece,” he notes. “They are furious with me. They feel as though I have made something public about their involvement with Bernie. It’s rather laughable, but it’s wreaking havoc with my family. The Greenbergers believe that there are only three times you should be mentioned in a newspaper—your birth, your marriage, and your death—and that’s what they’re about. We prided ourselves on being a perfect sort of family, and I guess the article throws some chinks in the works.”
The article was entitled: “Mom and Dad and Ruth and Bernie—Our Friend the Swindler.”
Bernie’s extracurricular high school activities consisted of being a locker-room guard and a member of the school’s swim team, the Sea Horses—dubbed the Mermen, according to team captain Fletcher Eberle.
Bernie, who joined the team in his sophomore year, “swam butterfly, and I was very often the anchor—freestyle anchor—in the medley relay,” says Eberle, who grew up near the Long Island beaches and had joined the Mermen in his freshman year.
Always thinking about ways to make money, Bernie parlayed his swimming ability into a job in his junior or senior years as a lifeguard at the exclusive Silver Point Beach Club in Atlantic Beach, an affluent oceanfront community. Bernie’s swimming had impressed the Mermen coach, Richie Sierer, an ex-Marine, who recruited him to work at the club along with others from the team. The pay was about $65 a week. The private club, which had opened in 1938, had some 60 acres of white-sand beachfront, and its well-to-do members rented luxurious oceanfront cabanas for the summer. They were Bernie’s kind of people, the kind he would later target.
Eberle considered Bernie “sort of devil-may-care. He didn’t take anything overly seriously. When we had a very important meet, we tried to get him hyped up, but he never really cared. But when he had to get in the pool and swim, he did.”
Eberle and Bernie had different physiques. Eberle was extraordinarily strong though he stood only five feet five—“everything a swimmer shouldn’t be. But I beat out guys who were six
feet tall because I had very strong arms, a very strong physique like Johnny Weismuller [an Olympic gold medal swimmer who played Tarzan in the movies]. Bernie never swam the 100-yard breaststroke or butterfly. He always swam the 50-yard event. He was not overly muscular, but muscular enough that he could pull himself out of the water doing the butterfly stroke—a strenuous exercise. Once he got in the water he was pretty driven and ambitious to win.”
Indeed, Bernie was a strong swimmer with apparent ice water in his veins. When John (Greenberger) Maccabee was 10 years old he had gone swimming in the Atlantic with Bernie and his future brother-in-law, Mike Lieberbaum, off the Greenberger family’s beach in Neponsit. Starting out strong, the Greenberger boy began losing momentum and was near the point of flailing. He looked over at Bernie to signal that he was in possible trouble. But Bernie, eyeing the boy, offered no help. The return swim was even tougher for Maccabee, who recalled Bernie in his “Noo Yawk accent” telling him, “Take longer strokes. Reach. Trust yourself.”
He wondered years later whether that was Bernie’s credo.
During Bernie’s stint as a Merman, and despite his abilities in the water, his team never won a championship, but did rank in the top three or four among New York’s public school swimming teams, according to Eberle. A 1954 issue of the Far Rockaway school newspaper, The Chat, reported that the team had a 4-4 record for the season, and stated that the medley team on which Bernie swam had won their first two meets.
Unlike most of the others in Bernie’s circle at school, Eberle didn’t go to college after graduation, but instead went into the Coast Guard for four years and stayed in the reserves for more than three decades, retiring as a chief warrant officer. He hadn’t follow Bernie’s career. But when he read about Bernie’s arrest, he contacted another classmate, Carol Solomon Marsden. “I said, ‘Is that our Bernie?’ I couldn’t believe it. If you told me that guy that I knew in the pool was into all this high finance, let alone major crimes, I wouldn’t believe it. I don’t have any transcripts to go by, but I know he was not a brain in school. I never thought he was super intelligent.”
Madoff with the Money Page 5