Some fear Madoff case stoking anti-Semitism ‘Affinity fraud’ not new, but accusations fan stereotypes BY JENNIFER PELTZ The Associated Press
NEW YORK — Of all the words that have been used to describe the Bernard L. Madoff scandal, the most emotionally charged may be “Jewish.” The disgraced investment guru is accused of orchestrating a $50 billion Ponzi scheme that preyed heavily on fellow Jews and ultimately drained the fortunes of numerous Jewish charities and institutions. There’s nothing new about con artists targeting their own kind. There’s even a word for it — affi nity fraud — and it has struck numerous religious, ethnic and professional groups. But the allegations against Madoff are particularly wrenching for some in the Jewish community, who fear that the sensational case is fanning vicious stereotypes about Jews that go back to the Middle Ages. ‘FODDER FOR BIGOTS’ The Anti-Defamation League cites a spike in anti-Semitic comments online after Madoff’s Dec. 11 arrest. A columnist for the Israeli newspaper Haaretz lamented the case as “the answer to every Jew-hater’s wish list.” And the American Jewish Committee’s executive director, David A. Harris, wrote a letter to The New York Times criticizing what he saw as “a striking emphasis” on Madoff’s faith in one of the paper’s many stories about the scandal. The case is “fodder for the bigots,” Abraham H. Foxman, the ADL’s national director, said in an interview this week with The Associated Press. “It’s both embarrassing and it’s painful.” It’s difficult to describe the case in any detail without mentioning Madoff’s religion. The 70-year-old money manager and former Nasdaq stock market chairman donated hundreds of thousands of dollars a year, much of it to Jewish causes. And many of the known victims of his business, Bernard L. Madoff Investment Securities, are big names in Jewish life. Yeshiva University, one of the nation’s foremost Jewish institutions of higher education, lost $110 million; Hadassah, the Women’s Zionist Organization of America, lost $90 million; director Steven Spielberg’s Wunderkinder Foundation acknowledged unspecified losses; and a $15 million foundation established by Holocaust survivor and writer Elie Wiesel was wiped out. Jewish federations and hospitals have lost millions of dollars and some foundations have had to close. Madoff is charged with securities fraud and is under house arrest in his Manhattan apartment with round-the-clock security. His lawyer has said he intends to fight the charge. The damage to the Jewish community is psychological as well as financial, said Kenneth Bandler, a spokesman for the AJC. He said his organization declined to invest with Madoff earlier this year because it was unable to decipher how Madoff was producing his renowned returns. At Jewish organizations and synagogues, Bandler said, people ask themselves: “How could someone who is held in such high esteem in the Jewish community knowingly rip off what were supposed to be his friends, the organizations he admired and supported?” Members of churches, minority groups and various occupations have wondered the same thing after falling victim to similarly targeted frauds. Religious-based schemes alone swept up more than 80,000 people and nearly $2 billion nationwide from 1998 to 2001, according to the most recent figures available from the North American Securities Administrators Association, an investor-protection group. The Baptist Foundation of Arizona told investors their money would build churches while paying returns. In fact, their savings were sucked into what authorities called a $550 million Ponzi scheme in the 1980s and 1990s. Several foundation officials were sentenced to prison in 2006 and 2007. Chicago real estate investment firm Sunrise Equities Inc. had the blessing of Muslim clerics, who said its dividends conformed with Islamic laws against earning interest. Its owner disappeared this past August, leaving 200 of his fellow Muslim immigrants with losses that could total $50 million. Whatever the circle, affinity frauds exploit trust. Victims are approached by one of their own and “therefore there’s less suspicion, there’s less concern,” said Joseph P. Borg, the Alabama Securities Commission’s director and a former NASAA president. Adding to the sense of betrayal in the allegations against Madoff are worries about whether they feed into centuries-old, ugly caricatures of Jews. Since Jews served as lenders in medieval Europe, where they were barred from many other occupations, they have sometimes been portrayed as miserly, greedy and obsessed with money. In just one example, Shakespeare’s Shylock, the Jewish character who demands a pound of flesh in payment for a loan in...................http://www.dailygazette.net/De.....amp;EntityId=Ar01100
CAPITAL REGION Local investors on list of Madoff’s victims BY JAMES SCHLETT Gazette Reporter Reach Gazette reporter James Schlett at 395-3040 or jschlett@dailygazette.net.
A number of Capital Region residents are among the victims of financier Bernard Madoff’s Ponzi scheme, according to a recently released list of investors who poured money into the alleged $50 billion scam. The names of several area doctors and financial consultants appear on the client list for Madoff’s advisory firm, which filed the list Wednesday with a Manhattan bankruptcy court. The 162-page filing by Bernard L. Madoff Investment Securities details the reach of the scam, which Madoff allegedly sustained for decades by using funds from new investors to pay quarterly dividends to older investors. Big names on the list include movie director Steven Spielberg, hall of fame pitcher Sandy Koufax and JP Morgan Chase Bank. Schenectady County contains a cluster of medical professionals who appear on Madoff’s list: cosmetic surgeon Dr. Carl Englebardt in Schenectady, orthodontist Stuart Kraut in Scotia and Dr. Demostene Romanucci in Niskayuna. Through a secretary, Englebardt declined to comment. Calls to Kraut were not immediately returned. A woman who answered the phone at a Latham address listed for Romanucci said he no longer lived there. Two executives at the Goldman Sachs financial consulting fi rm the Ayco Co. in Saratoga Springs also appear on the list: Eric Chew and Timothy O’Hara. In a 2002 U.S. Securities and Exchange Commission filing, Chew was listed as Ayco’s senior account manager. A 2008 Ayco investment adviser registration form lists O’Hara as the senior vice president of the firm’s Encompasse multifamily office practice. “Ayco has never invested in Madoff, and at no time did Ayco recommend Madoff to clients. Tim O’Hara and Eric Chew were not personal investors in.................http://www.dailygazette.net/De.....amp;EntityId=Ar00304
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