Madoff Scandal a Major Blow to Jewish Philanthropists, Charities
The arrest on Thursday of Wall Street trader Bernard L. Madoff, who FBI agents say defrauded investors of an estimated $50 billion, has had immediate consequences in the Jewish philanthropic world. One charity – the Robert I. Lappin Charitable Foundation – has already closed and The Forward reports "the ramifications of Madoff’s financial demise may extend to the many organizations he supported and the wealthy Jews he advised."
Madoff (pronounced "made off" -- ironically, some would say), 70, is suspected of defrauding his clients in a massive pyramid (or "Ponzi") scheme over several years.
The sole content on the website of Bernard L. Madoff Investment Securities is currently a short message announcing that a law firm has been appointed receiver over the firm's assets and accounts.
Madoff resigned on Friday from Yeshiva University, where he had served as the chairman of the
"The money needed to fund the programs of the Lappin Foundations is gone. The Foundation staff has been terminated today."
School of Business and treasurer of the board of trustees.
In a statement, a YU spokeswoman said that news of Madoff’s arrest had “shocked” university officials.
The same day, the Boston-based Robert I. Lappin Charitable Foundation, which had invested most of its money with Madoff's firm, closed its doors and fired its seven staff members. The goals of the 16-year-old charity had been “reversing the trend of assimilation and intermarriage.”
The charity's website announced:
"The programs of the Robert I. Lappin Charitable Foundation and the Robert I. Lappin 1992 Supporting Foundation are discontinued, effectively immediately. This includes Youth to Israel and Teachers to Israel.
"The money used to fund the programs of both Foundations was invested with Bernard L. Madoff Investment Securities and all the assets have been frozen by the federal courts... The money needed to fund the programs of the Lappin Foundations is gone.
"The Foundation staff has been terminated today.
“'It is with a heavy heart that I make this announcement,' said Robert I. Lappin, Foundation trustee. 'The Foundation's programs have touched thousands of lives over many years in our efforts to help keep our children Jewish.'”
Madoff made charitable donations to other Jewish organizations. He had chaired a gala fundraiser on behalf of Gift of Life, a Jewish bone marrow registry and umbilical cord blood bank. In addition, the Madoffs were significant contributors to the UJA Federation of New York.
The Wall Street Journal reported that members of the Boca Rio Golf Club in Boca Raton and the Palm Beach Country Club in Palm Beach, both heavily Jewish, were also heavily invested with Madoff’s firm.