Bernard Madoff, the convicted Ponzi schemer whose long-term, multi-billion-dollar financial manipulations ruined clients and rattled financial markets, has died.
The Federal Bureau of Prisons confirmed the death of Madoff, 82, at Federal Medical Center in Butner, N.C. The bureau told Deadline in a statement that it resulted from natural causes and not Covid-19.
About a year ago, Madoff’s attorney had requested his release, citing chronic kidney failure and saying he had just 18 months to live as of that time.
Madoff pleaded guilty in 2009 and was sentenced in 2011 to the maximum jail term of 150 years. Eventually, authorities managed to return $12 billion to investors, but that was just a fraction of the nearly $65 billion entrusted to Madoff. (Not counting fake profits, the actual losses from the fraud have been estimated at $17 billion to $20 billion.)
Adopting the classic Ponzi model, Madoff used incoming investments to pay returns to other investors instead of proceeds from what he claimed were successful investments. Eventually, the setup collapsed when too many clients were left in the cold. The downward spiral was accelerated by the onset of the financial crisis and the failure of Lehman Bros.
The Madoff affair spawned TV movies and bestselling books. His fraud ensnared Hollywood figures like Steven Spielberg as well as baseball’s New York Mets franchise. Spielberg’s charity Wunderkinder had invested in bogus Madoff funds. A number of Jewish charities were among those defrauded by Madoff. Branching out from his original investing pool of friends and family, Madoff went on to take money from universities, non-profits, institutions, hedge funds and other large investors.
Notable figures who invested with Madoff included Kevin Bacon and Kyra Sedgwick, former Los Angeles Dodgers pitcher Sandy Koufax and writer and activist Elie Wiesel, according to press reports.
Madoff’s story has been recounted in two major TV programs: Richard Dreyfuss played Madoff in the 2016 ABC miniseries Madoff, and Robert De Niro took the role in HBO’s 2017 movie The Wizard of Lies, directed by Barry Levinson.
Cate Blanchett has described Madoff’s wife, Ruth, as the inspiration for her character in Woody Allen’s 2013 film Blue Jasmine. Her performance earned Blanchett an Oscar for Best Actress. Though the couple had been married for 50 years at the time of Bernard Madoff’s guilty plea, Ruth Madoff always maintained she knew nothing about the fraud scheme. She was never charged.
Before his misdeeds began, Madoff, a native of Queens, NY, set out to be a legitimate player in finance. He started his own securities firm in 1960 with $5,000 he had made from summer jobs. Investigators later identified accounting irregularities dating back to the 1960s. Madoff would go on to serve as chairman of the Nasdaq and, even as his deceit secretly grew, was regarded as a Wall Street sage and an early adopter of technology at a time when trading was purely analog. His firm’s remarkably steady returns attracted scrutiny numerous times from regulators but never any serious penalties before his confession in 2008.
There was a distinct and tragic family dimension to Madoff’s crimes. Bernie Madoff’s brother, Peter, pleaded guilty to federal tax and securities fraud charges related to his role as the chief compliance officer of his brother’s firm. He was not accused of knowingly taking part in the Ponzi scheme. Madoff’s two sons both died in the years after his conviction, one of cancer and one by suicide.
Ruth Madoff told CBS in a 2011 interview that she and her husband had attempted suicide by taking pills shortly after his arrest in December 2008.
In a telephone interview with the Washington Post last year, Madoff said he “made a terrible mistake” and asked for compassion. “I’m terminally ill,” he said. “There’s no cure for my type of disease. So, you know, I’ve served. I’ve served 11 years already, and, quite frankly, I’ve suffered through it.”