by Brian Ross
“Can we say Madoff was a righteous Jew who served on the boards of Jewish institutions when he sank so low,” Ross began, and was again in tears and had to stop to regain his composure, with his wife holding him tight. “When he sank so low,” he continued with gasps, “as to steal from Elie Wiesel, as if Wiesel hasn’t already suffered enough in his lifetime. A righteous Jew, when in reality nobody has done more to reinforce the ugly stereotype that all we care about is money, despite the fact there are no people on this earth more charitable?”
The final victim to condemn Madoff was Cheryl Weinstein, who said she had met him when she served as the chief financial officer for Hadassah, a Jewish women’s charitable organization. “I now view that day as perhaps the unluckiest day of my life,” she told Judge Chin.
Eleanor Squillari remembered that Cheryl Weinstein was a frequent caller to Bernie over the years. “He would always roll his eyes when she called.”
Weinstein described how she and her husband had been forced to sell the family home because of their losses. “I felt it was important for somebody who is personally acquainted with Madoff to speak,” she said. “He is a beast that has stolen for his own needs the livelihoods, savings, lives, hopes and dreams, and futures of others in total disregard. He has fed upon us to satisfy his own needs. You should protect society from the likes of him,” she urged the judge.
Weinstein later published a full account of her long extra-marital affair with Madoff, something she failed to mention during her dramatic courtroom testimony.
The cumulative weight of the denunciations from Madoff’s once trusting investors was overwhelming, and efforts by his lawyer, Sorkin, to counter them failed miserably. “We cannot be unmoved by what we heard,” said Sorkin of the victims’ accounts. “No doubt, we represent a deeply flawed individual.”
In a letter to the judge a week earlier, Sorkin had called into question the motives of the victims. “We believe that the unified tone of the victim statements suggests a desire for a type of mob vengeance,” he wrote.
Now on his feet, the veteran defense lawyer tried another tack, suggesting that the size of Madoff’s crime had been grossly exaggerated by the news media, ignoring the fact that it was Madoff who initially set the total amount of fraud at $50 billion.
“The frenzy, the media excitement, that Mr. Madoff engaged in a Ponzi scheme involving $65 billion and that he has ferreted money away, as far as we know, Your Honor, that is simply not true,” asserted Sorkin. The $65 billion figure was the amount Madoff’s investors believed they had lost, based on the cumulative total of their last monthly statements. The government agreed that the actual amount of cash invested by investors between 1985 and 2008 was about $13 billion. Any amount beyond that represented the fake profits Madoff led his victims to believe they had earned.
Sorkin argued that much of the lost $13 billion might be recovered, suggesting that maybe Madoff wasn’t all that bad. Sorkin pointed out that he had not tried to flee, and he and his family had also suffered “an enormous toll.” Given Madoff’s thirteen-year life expectancy, Sorkin thought a twelve-year sentence would be fair.
“We ask only, Your Honor, that Mr. Madoff be given understanding and fairness, within the parameters of our legal system, and that the sentence that he be given be sufficient, but not greater than necessary, to carry out what this court must carry out under the rules, statutes, and guidelines.”
Madoff barely stirred as his lawyer spoke on his behalf. Sorkin’s delivery seemed flat. He had been dealt a losing hand from the very beginning of the case. First, Madoff had essentially turned himself in to the FBI without consulting Sorkin. Then, he had given a lengthy, though largely untrue, statement to the FBI without consulting him. Again and again, Madoff had been a difficult client who seemed to think he was smarter than his own lawyer. It wasn’t even clear if Sorkin’s firm would be paid much more than the initial $250,000 he received from Madoff.
As a consummate professional, however, Sorkin tried to fashion a cogent argument that would have some resonance with the judge. For the sake of future business, at least, he had to be seen as giving it a shot.
“Mr. Madoff, if you would like to speak, now is the time,” said Judge Chin.
Madoff stood up, holding his folded handwritten statement in front of him. His shirt collars now jutted outside his suit jacket, but he had given up any effort to tuck them in. It was over.
“Your Honor,” Madoff started and then stopped. His voice was too dry to go on. He sipped from a glass of water. “Your Honor, I cannot offer you an excuse for my behavior,” said Madoff, who three months earlier in his guilty plea had offered the excuse that his clients had pushed him to achieve impossible rates of return.
Another sip of water.
“How do you excuse betraying thousands of investors who entrusted me with their life savings?” Madoff said, trying his best to show some kind of remorse. At least he was no longer blaming the victims.
Then came the words that mattered most to him, as he again tried to deflect any blame or suspicion from his employees and his family. He knew his fate. This was his last chance to help others who were now under suspicion. “How do you excuse deceiving two hundred employees who have spent most of their working life working for me?” Lawyers for Frank DiPascali, Annette Bongiorno, and others who had worked on the seventeenth floor would appreciate that.
“How do you excuse lying to your brother and two sons who spent their whole adult life helping to build a successful and respectful business?” Madoff was back to the original version of his script that involved his confession to his brother and sons and then the FBI arrest. Andy and Mark might be behaving terribly toward their mother, but he was not going to throw them under the FBI bus.
“How do you excuse lying and deceiving a wife who stood by you for fifty years, and still stands by you?” Ruth was not there to hear the words, but she had already been told what Bernie would say. He told the judge that she would issue her own statement, part of a coordinated approach in which she would echo what Bernie said by announcing her own remorse. Everyone stayed on script.
To some reporters in the jury box, Madoff’s most heartfelt words seem to come as he said he was sorry for bringing disgrace on the securities industry. “How do you excuse deceiving an industry that you spent a better part of your life trying to improve? There is no excuse for that, and I don’t ask for forgiveness.” It seemed the one part of his statement that he read with true conviction. Lawyers for all feeder funds would find good use for those words as they continued to proclaim their clients’ innocence of any wrongdoing in their dealings with Madoff. They had been deceived by the master. If the SEC and the FBI had been fooled, how could they be expected to know better?
Madoff did not apologize for repeatedly lying to the SEC, but he went on to offer another explanation for his behavior. “I made an error of judgment. I refused to accept the fact, could not accept the fact, that for once in my life I failed. I couldn’t admit that failure and that was a tragic mistake.” This version of events seemed to imply that he had once been wildly and legitimately successful and then made one terrible mistake. Given his criminal, antisocial personality, the crime profilers had predicted this would be Madoff’s explanation.
“The real key is that they believe they haven’t done anything wrong,” said former FBI agent Brad Garrett. “It is like narcissism on a scale that wouldn’t fit in this room.”
Madoff continued to read in a flat, almost hoarse voice. “People have accused me of being silent and not being sympathetic. That is not true,” said Madoff as he neared the grand, theatrical climax of his statement to the judge. “They have accused my wife of being silent and not being sympathetic. Nothing could be further from the truth. She cries herself to sleep every night knowing of all the pain and suffering I have caused, and I am tormented by that as well.”
Many of the victims wondered why he had waited until this moment to express his sympathy. He had been facing Judge
Chin, with his back to them in the courtroom.
“I apologize to my victims,” he read as he then announced his next move. “I will turn and face you.” And he did. “I am sorry,” he said. “I know that doesn’t help you.” And just as quickly he turned his back to them again. He had looked at the large group of victims no more than three or four seconds, with a stare that seemed to be focused on the back wood-paneled wall of the courtroom. He didn’t make eye contact with any of them.
“Your Honor, thank you for listening to me.”
The victims in the courtroom were unimpressed with his statement and his quick pivot to face them and apologize. “Pathetic,” said Burt Ross. “It rings so hollow. I think it’s very insincere,” said Maureen Ebel, who was in the front row. “He did it perfunctorily and he just did it to help his case,” said another victim, Jeff Shankman, who had once worked on the Madoff seventeenth floor and socialized with him and his family.
Lead prosecutor Lisa Baroni was short and to the point in underscoring why the government sought the maximum 150-year sentence. “This was not a crime born of any financial distress or market pressures,” she said, contradicting Madoff’s version that he was forced to cover up a onetime failure. “It was a calculated, well-orchestrated, long-term fraud carried out month after month, year after year, decade after decade.”
Baroni made sure to address Sorkin’s contention that Madoff should get some credit for turning himself in and not fleeing. “The defendant continued his fraud scheme until the very end, when he knew the scheme was days away from collapse and when he was faced with redemption requests from clients he knew he could not meet.” Without saying it in so many words, Baroni made sure the judge knew the con man was still a man of deceit even after he turned himself in.
“The government respectfully requests that the court sentence the defendant to one hundred fifty years in prison or a substantial term of imprisonment that ensures that he will spend the rest of his life in jail,” she concluded.
Judge Chin appeared to agree, but before he passed sentence he took the time to destroy any vestige of credibility left in the arguments made by Madoff and Sorkin.
“Despite all the emotion in the air, I do not agree with the suggestion that victims and others are seeking mob vengeance,” said Judge Chin, going out of his way to criticize Sorkin’s claim that the victims were somehow orchestrated or undeserving. “Objectively speaking, the fraud here was staggering.”
“As many of the victims have pointed out, this is not just a matter of money. The breach of trust was massive,” the judge said, as he went through a point-by-point rebuttal of Sorkin and Madoff. They did not win a single point in this debate.
“It is true that Mr. Madoff used much of the money to pay back investors who asked along the way to withdraw their accounts. But large sums were also taken by him, for his personal use and the use of his family, friends, and colleagues.” And the judge then cited the money for the credit card purchases, the country club memberships, two yachts, and “the purchase of a Manhattan apartment for a relative.” Madoff’s vaunted generosity to his family—with stolen money—was now a guarantee he would spend life in prison.
Judge Chin said other arguments on Madoff’s behalf “are less than compelling.” He was unimpressed that Madoff “essentially turned himself in” because he knew “he was going to be caught soon.” As to Sorkin’s claim that Madoff had cooperated with the SEC by meeting with the inspector general for three hours, Judge Chin concluded, “I simply do not get the sense that Mr. Madoff has done all that he could or told all that he knows.” The investigators and prosecutors in the room certainly knew that. They expected to spend at least another year trying to unravel the criminal conspiracy that Madoff had refused to describe.
Finally, the judge explained why he was prepared to order a sentence that would be “largely, if not entirely, symbolic” given Madoff’s thirteen-year life expectancy. “Symbolism is important,” he said. “Here the message must be sent that Mr. Madoff’s crimes were extraordinarily evil, and this kind of irresponsible manipulation of the system is not merely a bloodless financial crime that takes place just on paper, but that it is instead, as we have heard, one that takes a staggering human toll.”
In one final sharp poke in the eye of Sorkin, Judge Chin returned to the “mob vengeance” claim. “I do not agree that the victims are succumbing to the temptation of mob vengeance. Rather they are doing what they are supposed to be doing—placing their trust in our system of justice.” If nothing else came out of the hearing, Sorkin and other members of the New York criminal defense bar now knew not to try the “mob vengeance” theme with Judge Chin again.
“Mr. Madoff, please stand. It is the judgment of this court that the defendant, Bernard L. Madoff, shall be and hereby is sentenced to a term of imprisonment of one hundred fifty years.”
There were cheers and applause from the victims in the courtroom. Many cried. Judge Chin did not order the courtroom to be silent.
“As a technical matter, the sentence must be expressed on the judgment in months. One hundred and fifty years is equivalent to eighteen hundred months.”
Madoff barely blinked. He said nothing to his lawyers and did not turn around to face his victims. Four U.S. marshals were in place in case anyone tried to rush Madoff. As he was led away and rounded the jury box, a few of the reporters and sketch artists got a close look at his face. There were no tears in his eyes. In fact, at a point where he may have thought no one could see his face any longer, there was a little smile, a smirk, as his lips turned up and he nodded his head. Two weeks later, Madoff would be bused to his new and permanent home at the Butner Federal Correctional Institution in North Carolina. It was a medium security facility, just as Bernie had hoped for.
There was glee in the air outside as the victims emerged from the courthouse.
“He has truly earned the reputation for being the most despised American today,” said Burt Ross.
Other victims scheduled a rally in front of the courthouse, where they turned their wrath toward the SEC, for failing to detect Madoff’s scheme, and the bankruptcy trustee and the Securities Investor Protection Corporation (SIPC), for playing hardball in calculating how much the victims were owed.
One hour later, Ruth Madoff offered her own attack on Bernie, as she sought for the first time publicly to show she also had sympathy for the victims whose money had paid for her life of luxury.
“I am breaking my silence now, because my reluctance to speak has been interpreted as indifference or lack of sympathy for the victims of my husband Bernie’s crime, which is exactly the opposite of the truth,” read a written statement crafted with the help of her lawyer, Peter Chavkin.
“And in the days since December, I have read, with immense pain, the wrenching stories of people whose life savings have evaporated because of his crime.” The expressions of sympathy did not include any apology, and the statement’s more important purpose was to permit Ruth to declare she was not involved in any way in the scheme. “I am embarrassed and ashamed. Like everyone else, I feel betrayed and confused. The man who committed this horrible fraud is not the man whom I have known for all these years.”
The statement also was a first step for Ruth in trying to reestablish her relationship with her sons, Mark and Andy, who had not spoken with her since their father’s arrest. They considered her “an enabler.” She wanted the boys to know she was not “an enabler” and had now joined the chorus of condemnation of their father.
Ruth did not appear in front of cameras to read the statement. She was too busy preparing to move out of the family home on East Sixty-fourth Street. Three days after her husband was sentenced, U.S. marshals arrived at the door of apartment 12-A and ordered Ruth to leave. She was denied permission to take her fur coat and left carrying only a straw bag.
Her deal with federal prosecutors did not preclude the SEC, the bankruptcy trustee, or any of the hundreds of private lawyers that represented the victims
from acting against her in order to seek restitution. Ruth’s $2.5 million was a small, but highly symbolic target.
She was unsure where to settle. Florida had laws that protected one’s home from lawsuits, but it was also a place full of her husband’s victims and painful reminders of her former life. Some people close to the family said they expected her to buy a small home near his prison in North Carolina. She was required to report any expenditure over $100 to the bankruptcy trustee, who remains suspicious that she and Bernie had hidden large amounts of cash somewhere.
Ruth still loved Bernie and wanted to continue seeing him and staying close as best she could as he spent the rest of his life in prison. She concluded that it was as if he had died but somehow she could still visit him. She told people close to her that, strangely, Bernie seemed much freer in prison than he had when he had all the fancy homes, the yachts, and the big bank accounts. He no longer had to worry about keeping his scheme going. She said that it was as if every part of him had been compromised by the awful situation he got himself into.
Now he was spending his days listening to a radio she’d sent him and reading all those books he had not had the time for during his life as a criminal. He had added Coben and Forsyth to Grisham as his favorite authors. He would have time for a much more diverse list of authors.
Madoff appeared to be working out and looked “buff,” according to one of his first visitors other than Ruth, San Francisco lawyer Joe Cotchett. Madoff appeared to be making himself at home and comfortable in North Carolina.
Even before she made her public statement, Ruth had talked with Bernie in prison about what he had done, about what they once had and what could have been. They had cried together. He had no tears for his victims, but he knew what he had lost and what he had done to Ruth. Their life together had been a fifty-year love story. The handsome suntanned lifeguard and the pretty blonde from Laurelton had been a perfect match. They had been just as happy running the business from a folding card table in their first apartment as when they had sleek offices in a Philip Johnson–designed building in Midtown Manhattan. The jet-set lifestyle was more than Ruth had ever hoped for.