Holocaust survivor & Nobel laureate Elie Wiesel lives to see foundation wiped out by Madoff scandal

[Liberal_in_LA]

In addition to hedge funds and banks, numerous other charities have lost millions to Madoff, including the Robert I. Lappin Charitable Foundation in Salem, which abruptly closed last week. In Boston, the family foundation of philanthropists Carl and Ruth Shapiro lost $145 million, and the couple lost millions more in personal funds. And the foundation of Holocaust survivor and Nobel laureate Elie Wiesel of Boston University reported it lost $15.2 million, nearly all of its assets, with Madoff.

http://www.boston.com/business/articles/2008/12/20/major_foundation_falls_to_madoff_fraud/

From Wikipedia:

In December 2008, the Elie Wiesel Foundation for Humanity issued a press release on their website stating that nearly all of the foundation's assets (approximately $15.2 million USD) have been lost through Bernard Madoff's investment firm.

[peacetalksforall]

1. When Madoff holds a press conference and removes his mask - who/what are we going to see? nt

[dflprincess]

17. Neil Bush?

This certainly sounds like something right up his alley.

[SoCalDem]

2. And yet he posted bond..for $10M..and they LET him..

Let's say a bank robber is caught with a duffle bag of money he stole from the bank..Is he allowed to reach in and pull out a wad of stolen cash to post bond??

That $10M he gave up as bond, should have been reserved to try and pay off some of the people he scammed..NOT for bond, so he could go back to one of his fancy digs & hang our watching TV all day..

[Kalyke]

3. Is one of those missles a shoe?

LOL

[SoCalDem]

9. all shoes:)

:)

[Kalyke]

12. Snigger... I see that now.

And sorry to laugh in a thread this serious. I just noticed the sig pic and snorted cola out of my nose. :)

[acmavm]

68. He also gets to hire his own 'guards'. Don't believe me? Check it out...

http://www.democraticunderground.com/discuss/duboard.php?az=show_mesg&forum=389&topic_id=4689675&mesg_id=4689675

[Hannah Bell]

4. Does anyone find it odd that major foundations would put all their

eggs in one basket - particularly one that's reporting wasn't quite - uh - standard?

[Tangerine LaBamba]

11. A lot of it was greed, but, as in the case

of Elie Wiesel's foundation, it was a matter of trusting a fellow Jew, throwing your business his way, believing that, as a landesman, he would do the right thing for you.

No different from me trusting some of my old Italian buddies to get certain things done for me when I can't do them myself. There's a certain trust there.

Madoff raped everyone.

[Hannah Bell]

14. i don't buy it. nope. they're not babes in the wood.

[cali]

18. Actually, It's hardly unheard of that brilliant people can be

quite naive financially.

[Tangerine LaBamba]

22. If you're a wealthy physician or lawyer or

engineer, why are you expected to know how the financial world works? That's as unrealistic as expecting a financier to know how to practice neurosurgery or labor law or civil engineering. That's also why people get paid to take care of those financial matters.

Do you breathe down your physician's neck while your blood tests are being run and the results aren't yet it? Do you insist on knowing exactly what went into the will your lawyer just drew up for you?

Some people just feel the need to punish people they don't even know by making inane pronouncements that betray their vast lack of information.

[Hannah Bell]

25. These foundations aren't run by doctors. They're run by financial managers,

who should know their ass from their elbow.

I'm not a financier, but I know enough not to put all my eggs in one basket.

(Most of the docs I know are pretty sophisticated in the $ management dept, btw)

[Tangerine LaBamba]

28. Did you read what I wrote?

Or are you deliberately not responding to the point I made? Maybe you're just being obtuse to be funny?

Who else did you think might be running financial institutions, and how did you get the idea that doctors ........ oh, never mind. I do believe continuing this exchange would be too much like playing with my food.

Best of luck to you and all your physician friends, the really hip and savvy money guys.

:::: sigh :::::

[Hannah Bell]

32. I read what you wrote. I fail to see your point, unless it's that now

all the foundation managers are also corrupt, & the docs or whoever too stupid to look at the quarterly reports & notice that all the principal is in one vehicle.

It isn't docs being reported as being the big losers, btw.

E.g. Stephen Spielberg, I'm sure he doesn't know beans about money.

I wasn't rude to you.

Best of luck with being an asshole.

[emilyg]

38. Yes. And another yes.

[JackRiddler]

48. The basics of diversified investment are not that difficult.

The neurosurgeon and the rocket designer can both figure out that 12 percent return every year is probably a scam. And probably they like it that way, until it goes sour. Your examples are puzzling. The language in a will is boilerplate and that's why you trust the lawyer. Anyone who doesn't want to know how their portfolio is invested is asking to be fucked. Fucked. Or else beyond naive. If you think there's honesty in capitalism, you are a sucker. That doesn't require brains, it requires a minimal resistance to being in denial about an essentially cannibalistic system.

[Tangerine LaBamba]

61. Boilerplate?

You don't know any estate lawyers, do you? Otherwise, you wouldn't have made such an uninformed remark.

Now, tell me how your bank has your savings account invested.

Right.

I just love people who believe that blaming the victim is an intelligent reading of the situation. I'm sure you think that rape victims are also asking for it because of how they might be dressed.

[JackRiddler]

72. No need for the overheated rhetoric (parallel to rape).

Savings accounts are protected under FDIC. If you're putting your money into anything else, you had best read the fine print and know how it's invested. That doesn't mean it's your fault if you are "raped" (as you might put it), not at all. But it's naive not to proceed from the assumption that scams are the norm.

[Tangerine LaBamba]

73. Nice tangent, nice evaluation

If that's your idea of "overheated rhetoric," then it's no wonder your posts are so inane.

[LeftishBrit]

51. Very good points!

[Hannah Bell]

24. Sure. But not universally. These are foundations, some rather large Their job is to manage money.

They hire $-saavy people to do it.

If I know about eggs & baskets, a foundation manager does too.

[Tangerine LaBamba]

21. What does that mean?

Do you know the workings of the people who handle your savings? What does your bank invest in with your savings account? Got a 401(k)? Where's it invested, and how do they work? You have insurance? If so, where does your insurance company invest, and how does that work? Who handles it for the insurance company, and what do you know about them?

Your glib dismissal suggests about as much as you know.

[Hannah Bell]

29. I don't have a 401K. I have my savings in various CDs & my retirement in

CDs & bonds held in different institutions. They can't lose principle unless the whole system fails.

I have checking & some savings with a credit union, run by a locally-based corp, stable since the 40s.

I'm very conservative with my money. I'd never put it all in one investment vehicle, & it's not standard policy for foundations & endowments to do so.

[Tangerine LaBamba]

39. Impressive

You are seriously thick. I have to thank you for the good laugh. I know it's not nice to make fun of someone so obviously clueless, but you make it impossible not to do.

Ever hear of a "rhetorical question"?

No, I didn't think so.

[Hannah Bell]

41. I see. I'm "thick" because I misread your "rhetorical question" on what I did with my own $.

But you, brilliant one, have no problem believing that foundations are run by naive folks who put all their principal in one vehicle - a vehicle with non-standard reporting & non-standard returns - because they don't know better.

Okay.

Some folks can't disagree without making it nasty & personal.

Too bad for them.

[Dorian Gray]

58. No, it isn't standard for foundations

to put all their eggs in one basket. I run a very small foundation (worth about $3 million), and we have two money managers who run our investments, and within those two money managers the endowment is divided into multiple investment vehicles. I think that's pretty standard, and it provides a safety net.

I do feel for Wiesel's foundation, though. I can see how, if you have a friendly relationship with someone, you can get caught up in something like this.

[Cronopio]

45. "Do you know the workings of the people who handle your savings?"

A non-rhetorical answer to your rhetorical question: No.

But if I had a few million dollars invested in a charity that people depended on for their well-being, I would never even consider turning those millions over to Madoff, or anyone else, without hiring someone who *does* know the ins-and-outs of the hedge fund business. I would be irresponsible to the charity recipients to do otherwise.

And if the person I hired to do the due diligence on Madoff was duped by his reputation, I would hold that person just as responsible and liable as Madoff. They didn't perform the due diligence I paid them to perform.

The moral of the Madoff situation is crystal clear: Investment banking is a casino, and if you are not a complete fool you do not bet money in a casino that you aren't prepared to lose. If you or others rely on having that money there at some future time, you stay away from the casino and you put your money in a commercial bank. Because *that's what they're for*. That's why commercial banks are covered by the FDIC and casinos aren't.

That's all I need to know about my savings bank.

[Tangerine LaBamba]

63. "... if I had a few million dollars..."

You know, until you have those "few million dollars," I think you're entirely unqualified to cast aspersions on people who do. Maybe people who have a lot of money have to spend a lot of time working to keep making that money. Maybe they have lives that require all their time and attention.

You clearly already know all you need to know. And you'll probably have no trouble in your tiny, narrow little world.

[muriel_volestrangler]

66. That's a ridiculous attitude

No, you don't need to have 'X' amount of money before you can make general observations on sensible things to do with that money.

For instance, we, as taxpayers, can make observations on what the government does with billions of dollars. We don't just leave it up to Warren Buffet, and say "it's all above our heads - only he is rich enough to know what to do".

[acmavm]

70. Yeah, blame everyone else but the guys who put their money in a scheme

that looked sooooooooo good how could it miss? Well, they got taken because they just couldn't be bothered to do their homework (those busy lives and all). No personal responsiblity involved here, of course not. These are the rich and they don't have to be personally responsible. Hey, we're paying billion upon billion to Wall Street just to prove that point.

It's just the little guys who have to manage our pennies and watch where are nickles are going. Lord knows, we live such lives of leisure and ease as opposed to those poor rich who can't afford the time or expend the energy.

What a burden it is to be rich!

[Cronopio]

76. Ok, if I wanted to invest a few thousand dollars in a charity. Or a few hundred dollars.

The principle is the same. Only the potential damage is different.

"... in your tiny, narrow little world."

Such pointless nastiness. Chocolate Santas can help.

[surrealAmerican]

60. Sadly, it's not at all unusual for charities to operate that way.

They are not the most financial savvy of organizations.

[Fumesucker]

27. I don't trust people just because I share an ethnicity with them..

And I don't understand why anyone else would either.

Jews are first and foremost human beings and human beings are imperfect, often wildly so.

[Tangerine LaBamba]

30. Well, then, you're obviously

not from my old neighborhood, and we do things differently.

Congratulations on noting that Jews are human. A deep observation...................

[Fumesucker]

40. It wouldn't matter if I was from your old neighborhood or not.

I learned to distrust people until I had positive proof of their good intentions very early on.

Not born cynical but I got that way very quickly, probably stems from the fact that I'm a very odd duck indeed in many ways and it took me quite a while to learn to hide my oddness.

Many of those who treated me the worst were of my ethnicity and sexual orientation and many of those who treated me with the most humanity were neither.

[Tangerine LaBamba]

62. I'm sure you find yourself interesting,

given the number of first person personal pronouns you use. Clearly, you find yourself fascinating.

I don't.

The post wasn't about you or who you trust.

Have a good day with your mirror.

[Fumesucker]

71. You do realize that personal insults are against DU rules?

The post was about who people trust and why, it's stupid to trust someone just because you share their ethnicity.

And you related your own experiences, using first person pronouns.

Stones, glass houses.

[Tangerine LaBamba]

74. Insult?

I hardly call a characterization of a post an "insult."

Plus, it was right on the mark. You still don't get what the post was about - you went off on your personal pronoun tangent.

Not interesting at all to me.

[Name removed]

33. Deleted sub-thread

Sub-thread removed by moderator. Click here to review the message board rules.

[slipslidingaway]

16. Quite simply...yes. n/t

[Hannah Bell]

34. Thanks for the confirmation & lack of snark.

Some folks can't disagree without making it personal, unfortunately.

[slipslidingaway]

64. No problem :) n/t

[Hannah Bell]

43. ok, by my calculation, 50% of respondents think it's weird that foundations put 100% of their funds

in one investment vehicle, while the other 50% think i'm "filth".

iow, the half who responded to the question agree - it's weird.

[Hannah Bell]

47. With 8 respondents reporting, we have: 4 who think it's weird, 1 who doesn't think so,

& three who think i'm "filth".

Yay! 50% for weird, 12.5% for not weird, 37.5% for "you're filth"!

weird is winning!

[Hannah Bell]

49. 9 respondents = 5 for weird, 1 for not weird, 3 for "you're filth!"

55.5% for weird! yay!

"filth" now down to only 33.3%!

can i get another non-filth vote!

can i get a witness, yes!

[Hannah Bell]

54. a friend of the "filth" contingent weighs in!

score, with 10 voting:

5 = weird, 1 = not weird, 1 = not weird & friend of the "filth-ers", 3 for "you're filth!"

50% weird
20% not weird* (with one of those voting being buds with the "filth-ers")
30% "you're filth!"


Every extra vote still brings my "filth-percent" down! yay!

[Hannah Bell]

75. with 13 reports, it's 8 for "weird", 1 "not weird," 1 "not weird & i'm buds with the filthers,"

& still 3 for "you're filth!!!!"

61.5% "weird"
15% "not weird" (*7.6% of which is filth-bud)
23% "you're filth!!!"

The "filth" % keeps declining, yay!

The "weird" % keeps rising, yay!

[AdHocSolver]

44. No more "odd" than all those institutions that bought billions of bundled bad mortgages.

How about all those individuals and institutions that bought lots of Enron stock?

When it comes to money, Americans are the most naive individuals on the planet.

More examples are people who bought gas-guzzling SUV's and trucks even as gas prices were increasing at a steady pace, and then complained about the cost.

Then there are the people who bought more expensive houses than they could afford by taking out adjustable rate mortgages because they believed housing prices would continue to rise indefinitely and that they could sell the houses at any time for a hefty profit.

Then there are the people who charge way more on their credit cards than they can pay back in one payment, and wind up paying usurious interest rates for the junk they buy.

If you want to include more fools and their money, then think of all the people who lost money investing in the stock market, the largest and most apparent Ponzi scheme on the planet.

The examples are endless.

[Hannah Bell]

46. Odder. To buy one bad investment is a mistake.

To put ALL of a FOUNDATION'S capital into one investment (hedge fund) - which isn't insured, which doesn't report in the standard way, & which offers non-standard returns...

Odd.

[LeftishBrit]

52. Not particularly

First of all, on the whole the larger organizations did *not* put all their eggs in this basket. Just some of them. The organizations that were destroyed (rather than just damaged) seem to have been relatively small foundations, that were mainly run by people outside the world of big finance.

And it is common enough for charitable and other groups to trust a financial organization too much, on the basis of what they know at the time. As the cliche goes, hindsight is 20-20. Lots of British charities and local governments suffered from putting money into the Bank of Iceland. It seemed like a sensible idea at the time. As it turned out, it wasn't.

[Hannah Bell]

53. wiesel's = 15 million. not big compared to the ford foundation,

but big enough that you might want to diversify.

those british charities & govs: did they put *all* their capital into the bank of iceland?

[muriel_volestrangler]

69. Not *all*, no

A typical case is a children's hospice near me:

The charity has £5.7m – 37 per cent of its cash – frozen in an Icelandic bank that failed in October.

The hospice has warned that administrators say it could take months if not years to recover the cash.

http://www.dailyecho.co.uk/news/3966820.5_000_sign_children___s_hospice_petition/

I think that it is more understandable in the hospice's case - it put money in an interest-bearing account, which was (more or less) the highest paying one available. You think that money is basically safe in a bank; you may, if you're the cautious type, wonder why that bank consistently pays, say, 1% more per annum that the British equivalent, but it's not hard to put that down to economic conditions (Iceland is outside the EU, it has different resources to the UK - you'd have to be a real economist to say why it wouldn't be sustainable in the long term). And, as you say, it wasn't all of their money.

[peacetalksforall]

5. Probably - all associated with the foundations are sincerely generous people. What we need to

look at are all the accounting firms. We know the core of Enrons rottenness was with the accountants. Where is the dividing line between above and below rottenness. I don't understand how no one suspected anything and talked it over with fellow accountants and thier foundation executives.

To have philanthropists taken down really hurts. It's so unbelievable severe for the tentacles down may not recover. The ones who made it out safe, may be the opposite of philanthropists.

Should we be thinking about Latvia, Monaco, South Korea sending us aid?

Who are the new accountants? When do we find out that the IRS as we know it is just for us and their IRS has a different set of legislation, signed off on by a group of people whose names we don't even know - who now have amassed nearly all the billions in places we don't know about?Billions of which a significant per cent is and will be going to our containment and guaranteed obedience? That's the way it would be scripted for Hollywood. What can surpirse us now?

[Hannah Bell]

35. al"l associated with the foundations are sincerely generous people."

Having worked in & around the grant-making/endowment scene, I can tell you, this isn't the case.

Some are functionaries, some are careerists, some are social climbers, some are tax cheats/avoiders, some are using their foundations to steer policy, some are just sharks.

In my experience, the genuinely "generous" are no more prevalent than anywhere else.

[peacetalksforall]

42. I've only met some people who worked for some and as contractors.

They all checked out. Don't know about the top end.

[panader0]

6. Can we string him up by the balls?

I reread 'Night' a few months ago when my daughter had to read it for school. So sad for Elie.

[Tangerine LaBamba]

10. I have all his books,

and as many times as I've tried to read them, I cannot. I always start crying and can't stop.

I should just donate them to the library. I'll never be able to read them, but how wonderful that your daughter's class is reading "Night." That's one hip teacher she has. Good for her, and, more, good for you.

:toast:

[Tangerine LaBamba]

7. That is the one that broke my heart

Elie Wiesel, of all people. What kind of monster steals from the most celebrated and honored Holocaust survivor, a man who has devoted his life to making sure people never let it happen again?

A fellow Jew.

The horror of this is, I am afraid, going to be dangerous to Wiesel's health. He is not a young man.

How much betrayal must one person endure, at the beginning of his life and at the end?

Madoff should be locked up now and never allowed to see daylight again. He is a monster of impossibly epic proportions, and he preyed primarily on Jews. It's too horrible.

I once met Elie Wiesel. It changed me forever.

[LeftishBrit]

55. I agree with you - this is really devastating!

[Number23]

78. I feel the same way

If anyone deserved to be the first recipient of a mandatory life sentence for financial fraud, it's this Madoff @sshole.

What this man has done, not only to Mr. Wiesel, but to the potentially life-saving medical and social research done by the organizations he's conned is criminal to the extreme.

I am hoping that perhaps some wealthy and generous philanthropists can step in and salvage some of these organizations. Oprah toured Nazi death camps with Mr. Wiesel and is a huge supporter of him so perhaps she may be able to provide him with some financial shelter.

[HarukaTheTrophyWife]

8. That's just really upsetting

[derby378]

13. This is Ninth Circle of Hell material, right?

I think Elie Wiesel should have made a smarter choice than this, but what Madoff did was worse than criminal.

[Tangerine LaBamba]

37. How 'smarter'?

Given the reputation Madoff had - for YEARS! - whoever made the decision as to where the Foundation's money went made the best and most appropriate decision, given the circumstances.

Are people really naive enough to think Elie Weisel was the one who decided who would handle the money? If so, then the lack of information about how money works is astonishing.

[thunder rising]

15. Elie Wiesel apparently isn't as smart as it would seem ... sorry, but it's true

scams are only successful because of the greed of the victims.

[intheflow]

19. Is it greedy to raise money for a charitable organization?

It's not that Weisel was trusting Madoff with his own money so he could buy more yachts or build more golf courses. He established his foundation with the money from his Nobel Peace Prize. His foundation has helped Ethiopian Jews and Darfur refugees and organizes international conferences for youth in war-torn countries.

[cali]

20. oh fuck. that's ridiculous. First of all, Wiesel would hardly be

the only person who's brilliant in some ways and not so smart when it comes to financial matters. Secondly, it is not true that every victim of a scam is greedy. Thirdly, Wiesel was hardly in this for his own benefit- and that's the essence of greed.

[madamesilverspurs]

23. Not true.

That's like insisting that a woman was raped because she was dressed attractively. Or that what "she" said made "him" hit her. The victim may have been foolish, but foolishness (or gullibility, or naivete) on the part of the victim is not an invitation to wrongdoing on the part of the perpetrator. There are those who will always take advantage of others, and they alone are responsible for their actions.

[Name removed]

36. Deleted message

Message removed by moderator. Click here to review the message board rules.

[rockymountaindem]

26. My Rabbi talked about this in his sermon today

The entire Jewish philanthropy network has suffered huge losses. This is extremely bad for us.

I hope Madoff rots in prison for the rest of his life.

[EFerrari]

31. I'm so sorry. No words for something like this.

:(

[LeftishBrit]

50. Just awful

[Waiting For Everyman]

56. The subprimes were deadbeats but the Madoff investors are victims.

I'm just enjoying the hypocrisy. And charities, schools etc. who went for the extra profit instead of CDs or savings accounts should be ashamed of themselves. All of these hedge funds were involved in screwing homeowners and other debt-payers to get the high profits. The investors were not unaware of that. They knew, or should've known. They were the "educated", "wealthy" people - so what's their excuse?

These people were enabling criminals for their own enrichment. I find it sort of amusing that now the wealthy are devouring themselves too. Oh, how awful it is! (Aren't hedge investors required to be wealthy enough to afford the losses, isn't that the criteria for "being allowed into" one?) These people had a choice. The people they were gouging by proxy did not... and they didn't care one bit, as long as the spigot was flowing from the big sucking siphon out of everyday peoples' pockets.

You'd think hedge funds that invested in doing more socially positive things would've come into being, for all of these wonderful wealthy philanthropists to invest in... what about something more like Habitat for Humanity? What about using wealth for good purposes? Using the influence of their money to promote something constructive? Never occurred to them, no doubt, to use it in that manner.

Karma's a bitch, ain't it?

[Dorian Gray]

59. I run a non-profit

foundation, and I was always under the impression that, according to tax law, we are not allowed to invest in hedge funds. After some reading just now on the matter, I found that I was wrong, but many of the books that I have on the matter heavily dissuade from doing so.

[JNelson6563]

57. Ok, here's what I don't understand

I am just a simple little person and yet even I know that it's a good idea to diversify. $15.2 million dollars in the hands of a "firm" that barely even issued statements? hmmmm.

Whoever advised that was either in on it or not very bright.

Julie

[depakid]

65. "Whoever advised that was either in on it or not very bright."

They were also negligent in failing to conduct due dilligence and breached fiduciary duties.

Hope they had good D & O or E & O coverage- because they're going to need it.

[spanone]

67. any investor would tell ANYONE.....DIVERSIFY....buyer beware

[Fire1]

77. Aww, what a shame, but they'll be up and running in no time.

:P