There was a breath-long pause. “How do you excuse lying and deceiving a wife who stood by you for 50 years—and still stands by you?”
He inched towards a smudged sketch of what he had done. “I believed when I started this problem—this crime—that it would be something I would be able to work my way out of, but that became impossible. The harder I tried, the deeper I dug myself into a hole.” He was accustomed to making trading mistakes, he said. They were part of his business; he could forgive himself for those. But he had made more than a mistake in this instance, he’d made “a terrible error in judgement. I refused to accept the fact—could not accept the fact that for once in my life, I had failed. I couldn’t admit that failure and that was a tragic mistake.”
On paper, his words seemed deeply remorseful, although they were delivered in a bleak, leaden voice: “I am responsible for a great deal of suffering and pain. I understand that. I live in a tormented state now, knowing of all the pain and suffering I have created. I left a legacy of shame, as some of my victims have pointed out, to my family and grandchildren. That’s something I will live with for the rest of my life.”
He tried, too late, to repair the damage caused by months of standing mute. “People have accused me of being silent and not being sympathetic. That is not true,” he said. “People 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.”
He said that he and Ruth had remained silent on the advice of their attorneys. But he added that Ruth would release a written statement later in the day expressing her anguish and sympathy for his victims. “I ask you to listen to that,” Madoff said. “She is sincere, and all I ask [of] you is to listen to her.”
In a way, the sheer impossibility of making anything better or different seemed to suck the life out of his final sentences. He almost acknowledged this: “Nothing I can say will correct the things that I have done. . . . There is nothing I can do that will make anyone feel better.”
He concluded: “But I will live with this pain, with this torment, for the rest of my life. I apologize to my victims”—and now he abruptly turned in place and looked at the crowded courtroom, his face haggard with deep grey triangles under his eyes—“I will turn and face you and say I am sorry. I know that doesn’t help you.”
He turned back to the bench. “Your Honor, thank you for listening to me.” He sat down.
The government’s case, too, was a short familiar solo before the final act. Everyone knew that the prosecutors wanted a sentence of 150 years; they had laid out their reasons in a memo made public a few days earlier. “For more than 20 years, he stole ruthlessly and without remorse,” said Lisa Baroni, one of the prosecutors. “Thousands of people placed their trust in him and he lied repeatedly to all of them.”
But the climax in this drama could come only from Judge Chin.
“Despite all the emotion in the air, I do not agree with the suggestion that victims and others are seeking mob vengeance,” he observed. He agreed with Sorkin that Madoff was entitled to a sentence “determined objectively, and without hysteria or undue emotion.”
But he did not linger there. “Objectively speaking, the fraud here was staggering,” the judge went on. “It spanned more than 20 years.” Perhaps Madoff did not begin to mingle his fraud’s cash with his firm’s assets until the late 1990s, the judge continued, “but it is clear that the fraud began earlier.”
Judge Chin found no mitigating factors. “In a white-collar fraud case such as this, I would expect to see letters from family and friends and colleagues. But not a single letter has been submitted attesting to Mr Madoff’s good deeds or good character or civic or charitable activities. The absence of such support is telling.”
Given Madoff’s age, Judge Chin acknowledged that any sentence above twenty years was effectively a life sentence. “But the symbolism is important,” he added. Madoff’s betrayal had left many people, not just his victims, “doubting our financial institutions, our financial system, our government’s ability to regulate and protect, and, sadly, even themselves.”
The victims were not “succumbing to the temptation of mob vengeance,” he concluded. “Rather, they are doing what they are supposed to be doing—placing their trust in our system of justice. . . . The knowledge that Mr Madoff has been punished to the fullest extent of the law may, in some small measure, help these victims in their healing process.”
He paused. “Mr Madoff, please stand,” he instructed.
Madoff and Sorkin stood together.
“It is the judgement of this court that the defendant, Bernard L. Madoff, shall be and hereby is sentenced to a term of imprisonment of 150 years—”
A cheer from the benches stopped him but was quickly stifled. He continued to itemize the sentence for each felony count. “As a technical matter,” he added, “the sentence must be expressed . . . in months; 150 years is equivalent to 1,800 months.” A few details were then added to the record, and Madoff was advised that he had limited rights to appeal.
The curtain came down: “We are adjourned.”
Madoff was once again handcuffed and led out a side door. At seventy-one, even if he had two more lifetimes ahead of him, he would spend them both in prison.
Just three days after Madoff’s sentencing came the closing of another chapter in the story of his fraud. Five miles uptown from the US courthouse, a female US marshal stood in a closet off the master bedroom in the penthouse apartment on East Sixty-fourth Street, as Ruth Madoff negotiated what she could pack into cartons and take with her.
She was leaving behind the appliances, the furniture, the artwork, the designer clothing, the gowns, the top-end fur coats—all the “insured and readily saleable personal property” in what was once her home. She had been told that she could keep items that could not be readily sold, and she hoped to keep the well-worn, thirty-year-old fur coat she was holding, which was arguably too old to have any resale value.
Maybe we could get a dollar for it, the marshal replied. The fur coat stayed.
So did her used golf shoes, three used golf gloves, thirty miscellaneous used golf balls, several crocheted golf club covers, seven Ella Fitzgerald commemorative euro-denominated postage stamps found in a coin purse, and a 1967 quarter fished out of a no-name black leather shoulder bag.
Meanwhile, the television cameras had settled outside the apartment building, somehow alerted to the fact that the US Marshals would be taking over today. Ruth Madoff discovered the gauntlet and managed to slip out of the building, for the last time, through a back entrance.
The day before, the Wall Street Journal had reported online that after six months of investigation, there was no evidence that Ruth had been involved in her husband’s fraud.
Much remained a mystery about Bernie Madoff’s crime, even after he pleaded guilty in March 2009. But one thing, it seemed, that everybody knew was true was this: his wife and sons were guilty, too.
From the first weeks after his arrest, unidentified “former prosecutors” and “criminal lawyers who have followed the case” and “legal sources” were repeatedly quoted in various media outlets asserting that Ruth, Mark, and Andrew Madoff were under investigation and would soon be indicted. Glossy magazine articles would speculate carefully; garish Internet blogs would accuse recklessly; television commentators would wink and nod knowingly. All that fierce, smug certainty about their guilt—unsupported by any cited facts—effectively drove Madoff’s immediate family into exile.
In an era of hypermedia, with mobile phone paparazzi and self-defined Internet commentators constantly on the alert for ways to attract attention, it is worth noting that these attacks on the Madoff family were a sharp departure from the typical public reaction to cases of white-collar crime, going back more than a century.
Of course, such criminals—confidence men, embezzlers, crooked pol
iticians, fraudsters of all kinds—were attacked savagely by the press and the public when their crimes came to light. But their wives and children were almost never included in those attacks; rather, they were almost always ignored or, at the very least, quickly left alone. There were a few exceptions where criminal charges were actually filed against a close relative, who was then pulled to the whipping post of public attention. In general, however, even the wives and children of executed murderers were left to rebuild their lives in relative obscurity, unless they sought the spotlight themselves.
The treatment over the years of organized-crime defendants is instructive. Despite widespread fascination with the murderous escapades of so-called “Mafia dons” and crime-family “capos”, it was extremely rare for any attention to fall on the elderly Mrs Mafia Don or the capos’ children —even though a realist might have wondered how much they knew about why their husband or father had asked all his closest buddies to wear guns and sleep on mattresses in the garage. On rare occasions, a mobster’s relatives actively courted publicity. (The Gotti family comes to mind.) But those who didn’t were routinely ignored by the media and certainly were never publicly and repeatedly accused of complicity in their husbands’ or fathers’ crimes.
Yet the public outcry against Ruth Madoff and her sons began almost from the instant of Madoff’s arrest and did not cease. By the time he pleaded guilty, it was deafening.
From the beginning, however, there were facts in the Madoff case that just didn’t seem to be consistent with the family’s guilt.
First, there was the fact that none of them fled the country. Perhaps Bernie Madoff, seventy years old at the time of his confession, felt too old and tired to live as a wealthy fugitive; and perhaps Ruth, even if she were guilty and faced arrest and a lifelong imprisonment, would not leave without him. But his two sons, if they were guilty, had the opportunity, the means, and the motive to flee. The end was clearly in sight weeks in advance, there was still a princely sum in the bank, and they and their families were young and relatively portable. Surely Madoff, before turning himself in, would have handed his sons the keys to the company jet and enough cash to let them live comfortably beyond the reach of the law for the rest of their lives. After all, if they were his accomplices, their only other option would have been to stay and go to prison.
And yet Madoff did not flee—and neither did his wife or sons.
Then, there was his confession. Some hostile theorists immediately argued that Madoff and his guilty sons staged his confession so they could turn him in and thereby deflect suspicion from themselves. But this would have been a worthless gesture unless they all could have been absolutely sure that no incriminating evidence would surface later and none of their other low-level accomplices would finger the sons in a bid for leniency—assumptions that were not remotely realistic if the sons were actually guilty. Moreover, if Madoff truly believed anyone could be insulated from suspicion simply by turning him in, wouldn’t he have arranged for that to be Ruth?
Logic aside, assumptions about the family’s guilt began to run up against the fact that, as the Madoff investigation progressed, the predicted arrests of his wife and sons simply did not happen.
It is true that the legal bar for proving that Ruth, Mark, or Andrew Madoff shared Bernie Madoff’s guilt was high. To tie them to the Ponzi scheme, prosecutors had to do more than prove that they had somehow suspected the fraud, or had stumbled across it, and looked away. It is almost never a federal offence in the US to fail to report a crime one merely observes. Instead, prosecutors would have had to prove that they knowingly helped plan the fraud, carry it out, or cover it up.
Yet for two years into the investigation, with other suspected accomplices quietly trying to negotiate deals with prosecutors and earn a little mercy from the courts, neither the government nor those accomplices made any public (or artfully leaked) accusations against Ruth, Mark, or Andrew. Indeed, the family members were never even formally notified by prosecutors, as would be required, that they were the subject or the target of a criminal investigation.
Of course, all those accumulating details do not mean that prosecutors will not act against Madoff’s family at some point in the future; new evidence could surface, even years from now. And, apart from the fraud, the family remains vulnerable to US federal tax charges arising from their casual use of company cash, credit cards, and low-cost loans. But what those accumulating details do mean is that there was insufficient evidence to support even a formal notification that they were the subjects of a criminal investigation during the months and years when they were being repeatedly accused in public of being Bernie Madoff’s accomplices.
Another fact, visible very early in the case, suggests that the prosecutors did not believe that Madoff’s sons, at least, knew anything about the crime before their father’s confession: Mark and Andrew Madoff continued to be represented by the same lawyer, Martin Flumenbaum.
Typically, no two suspects in a criminal investigation can be represented by the same attorney, for reasons so obvious that most people don’t even need to reflect on them. What if Suspects A and B are sharing a lawyer when Suspect A decides to cut a deal and testify against Suspect B? Who will help him negotiate with the prosecutors—the same lawyer who also is honour-bound to look out for Suspect B’s best interests? Definitely not.
It would have been unethical for Flumenbaum to represent both brothers if he had known they were under criminal investigation and might best be served by turning on each other and seeking a deal with prosecutors. Even if the two brothers had sworn a guilty allegiance to each other behind some cover story, it would have been irregular for prosecutors to permit Flumenbaum to represent both sons if a criminal case were secretly in the works against either or both of them.
Yet Flumenbaum remained on duty, alone. Experienced defence lawyers understood the implications; the public, by and large, did not.
As early as December 16, 2008, the New York Times reported that investigators had found no evidence linking the sons to Madoff’s Ponzi scheme—except as victims and as witnesses to their father’s confession. Nevertheless, Mark and Andrew Madoff were vilified on the Internet, insulted in public, sued in court, accused in books and magazine articles, and pursued by photographers wherever they went.
The brothers had grown up in the shadow of an autocratic, controlling father whom the whole family considered a genius and to whom their mother constantly deferred. Despite the difficulties his personality created in their relationship, they apparently loved and admired him. At the same moment their father’s crime had destroyed that relationship, it had shoved both of them from lives of near anonymity into a blistering media spotlight, where nothing could be protected as private.
Andrew Madoff’s seventeen-year marriage to his wife, Deborah, had already broken apart, and they had been separated for more than a year. The divorce papers were filed on the same day as his father’s arrest, a coincidence that provided tabloid fodder for days. There were news reports—untrue, his friends would later insist—that some parents of his two young children’s friends grew leery of including them on playdates, allegedly worried that their own children might get caught in any ugly verbal cross fire from angry victims. At the time of the arrest, Andrew was living with his fiancée, Catherine Hooper, an accomplished woman whose background as a fly-fishing guide was promptly dissected down to the bone on the gossip circuit.
One of Andrew’s early expeditions out of their apartment after his father’s arrest was to pick up a take-out meal. It ended in a “sidewalk scuffle” with an angry former Madoff trader, who recognized him, accused him loudly of being a criminal, and shouted crude sexual insults at Hooper. At that, Andrew exchanged punches with the trader and drove away in fury. Later, when he calmed down, he turned himself in to the police. No charges were filed.
Andrew’s battle with cancer, which had begun with the discovery of a swollen lymph node in his neck in March 2003, seemed to mark a break with his former
life at the firm. At thirty-seven, he had lymphoma, tentatively diagnosed as a rare and almost always fatal form called mantle cell lymphoma, although a firm diagnosis would prove elusive. He underwent six weeks of treatment and “came out of the experience with a shaved head, a newfound interest in yoga and an outward soulfulness I hadn’t seen before,” his younger cousin Roger noted in a posthumously published memoir about his own losing battle with cancer. After his diagnosis and treatment, Andrew took more vacation time, spent more time with his two children, embraced his lifelong piano study, and talked openly about the importance of enjoying each day because “life is short.”
Mark Madoff’s life also became a fishbowl. All of tabloid New York knew that he and his second wife, Stephanie, had a new baby in February 2009, Mark’s fourth child and their second child together. Everyone in the Madoff blogosphere knew that neither Ruth nor Bernie had seen their new grandson because Mark, like Andrew, had avoided any contact with his parents since the day of the confession. In months to come, everyone with a television set or computer would know that Mark’s wife petitioned the court to change her own and their children’s last names to “Morgan”, to avoid the stigma and danger of the Madoff name—a name her husband could not shed so easily.
Most people who knew the family thought that Bernie felt closer to Mark, who was warmer and less cerebral than Andrew, although each son always got a hug and kiss from his father whenever Madoff returned to the trading floor after an extended holiday. One longtime friend recalled going to dinner with Ruth and Bernie one evening in 1999, when Mark’s first marriage was splintering apart after nearly a decade. “Bernie spent 90 percent of the dinner outside talking with Mark, sort of holding his hand,” this friend remembered. Also, Mark was more likely than Andrew to join their father in glad-handing the crowd at securities industry events and the annual employee parties at Christmas and on the beach at Montauk.
Bernie Madoff, The Wizard of Lies Page 36