The list of charities devastated by Bernard Madoff’s alleged fraud keeps growing and now includes celebrities such as Steven Spielberg.
From the AFP:
Steven Spielberg’s charitable foundation fell victim to the mammoth 50-billion-dollar fraud allegedly carried out by Wall Street heavyweight Bernard Madoff, reports said.
It is not known if the Oscar-winning film-maker had chunks of his personal fortune invested with Madoff but the director’s Wunderkinder Foundation has suffered losses, according to the Wall Street Journal.
The foundation could not be immediately contacted for comment.
The newspaper reported that about 70 percent of the dividend income and interest for the foundation had been handled by Madoff’s securities firm, which is now the subject of one of the biggest fraud investigations in history.
The Journal also cited people familiar with the case as saying that Spielberg’s partner at DreamWorks Animation SKG, chief executive Jeffrey Katzenberg, had sustained “millions in Madoff-connected losses.”
The report said both Katzenberg and Spielberg were the only two clients of legendary Hollywood financial adviser Jerry Breslauer, who had dealt with Madoff since 2004.
The alleged $50 billion fraud by former Nasdaq Chairman Bernard Madoff has rippled deep into Boston’s wealthy elite, forcing a charitable foundation to close and triggering losses by prominent philanthropists.
The Robert I. Lappin Charitable Foundation, which financed trips for Jewish youth to Israel, said the money that supported its programs was invested with Madoff, a 70-year-old Wall Street trader arrested on Thursday.
“The money needed to fund the programs of the Lappin Foundation is gone,” the Salem, Massachusetts-based foundation said on its website, adding all staff had been let go.
“It is with a heavy heart that I make this announcement,” Robert I. Lappin, the foundation’s trustee, said in a statement.
The Boston Globe reported on Saturday that other clients of Madoff included philanthropists Carl and Ruth Shapiro, big donors to the Museum of Fine Arts, Brandeis University and the Beth Israel Deaconess Medical Center.
The Shapiro family foundation lost almost half its money, or about $145 million, to Madoff, the newspaper said.
Other clients included Avram and Carol Goldberg, a previous owner of the Stop&Shop supermarket chain, and Stephen Fine, president of privately held Biltrite Corp.
Federal agents arrested Madoff at his apartment on Thursday after prosecutors said he told senior employees that his money management operations were “all just one big lie” and “a giant Ponzi scheme.”
A Ponzi scheme is an illegal investment vehicle that pays off old investors with money from new ones and is dependent on a constant stream of new investment. Because the invested capital is not earning a sufficient return on its own, such schemes eventually collapse under their own weight.