Hadassah, the Women’s Zionist Organization of America, announced Wednesday that it had invested $90 million with Bernard Madoff, who has been charged with securities fraud.

“We are currently in the process of investigating the exact amounts and their impact, but it appears that at the time of his arrest, Hadassah had approximately $90m. invested with his firm,” the organization said Wednesday in a statement.

“Falling victim to this unprecedented fraud will require us to make necessary adjustments, but it has not in the slightest affected our commitment to our core Zionist mission. These are indeed turbulent times, but the key pillars of Hadassah remain as strong as ever.”

Hadassah was already facing tough times because of the current economic downfall, adopting cuts in its operating budget and expecting additional reductions in the coming months. The details of the yet-to-be-determined cuts are likely to become more clear following a board meeting in January.

“Now the Madoff situation compounds and accelerates the matter,” said a source close to the situation.

A Hadassah spokesman said it was not clear whether the losses connected to Madoff would affect the construction of a new tower at its main campus in Ein-Kerem.
Bernard Madoff returns to his…

Bernard Madoff returns to his Manhattan apartment after making a court appearance Wednesday in New York.
Photo: AP

Meanwhile, the US Congress will investigate the alleged pyramid scam run by Madoff, a leading House lawmaker said Wednesday.

Madoff, who has been charged with securities fraud, remains free at his Park Avenue apartment, after the judge overseeing his case agreed to renew his bail.

The 70-year-old financier had been free on $10 million bond but now must wear an ankle-monitoring bracelet and observe a 7 p.m.-to-9 a.m. curfew.

Madoff did not appear in court after Judge Gabriel Gorenstein canceled a scheduled bail hearing and issued the changes in a written order.

Madoff agreed to surrender his vacation houses in Montauk, New York, and Palm Beach, Florida, if he flees. The change was submitted after Madoff said he was unable to find two cosigners (in addition to his wife and brother) to vouch for him.

Madoff’s attorneys have until Monday to submit additional paperwork.

The scandal has “further weakened already-battered investor confidence in securities markets and has raised more troubling questions about the effectiveness of the regulatory system,” said Rep. Paul Kanjorski (D.-Pennsylvania), chairman of the House Financial Services subcommittee on capital markets.

Kanjorski said he’ll convene a congressional inquiry early next month to examine the alleged fraud and to determine why the Securities and Exchange Commission and other regulators “failed to detect these substantial evasions.”

The planned congressional inquiry follows a stunning rebuke that Securities and Exchange Commission Chairman Christopher Cox leveled against his agency’s career regulators, blaming them for a decade of failure to investigate Madoff and for failing to detect the largest pyramid scam ever.

At the Justice Department, a spokesman said that Attorney-General Michael Mukasey had recused himself from the investigation into Madoff. Mukasey’s son Marc is representing Frank DiPascali, a top financial officer at Madoff’s investment firm.

DiPascali was the Madoff employee with the most day-to-day contact with his investors. Several described him as the man they got on the phone when they had questions about the firm’s investment strategy, or wanted to add to or withdraw money from their accounts.

Authorities have not said publicly whether DiPascali is suspected of any wrongdoing.

“We are trying to learn the facts like everybody else,” Marc Mukasey said, in a phone interview with The Associated Press on Tuesday.

A former SEC attorney, Eric Swanson, married Madoff’s niece Shana last year, The Wall Street Journal reported.

The SEC’s compliance office issued a statement on Wednesday saying Swanson was part of a team that looked into Madoff’s securities brokerage operation in 1999 and 2004. The SEC cited its “strict rules” prohibiting employees from participating in cases involving firms where they have a personal interest.

The SEC’s inspector general, David Kotz, said on Wednesday that as part of his investigation, he intends to examine the relationship between Madoff’s niece and Swanson.

“There are a lot of different issues” as outlined in Cox’s statement, Kotz said. “We obviously will move as soon as possible.”

Fuente: http://www.jpost.com/servlet/Satellite?pagename=JPost/JPArticle/ShowFull&cid=1228728239808

U.S. regulators never inspected Bernard Madoff’s investment advisory business, alleged to be a Ponzi scheme that cost investors $50 billion, after he subjected it to oversight two years ago, people familiar with the case said.

The Securities and Exchange Commission hadn’t examined Madoff’s books since he registered the unit with the agency in September 2006, two people said, declining to be identified because the reviews aren’t public. The SEC tries to inspect advisers at least every five years and to scrutinize newly registered firms in their first year, former agency officials and securities lawyers said.

Fuente: http://www.huffingtonpost.com/2008/12/15/sec-missed-madoffs-ponzi_n_150953.html

The Bernie Madoff ponzi scheme is hitting both individual investors like Senator Frank Lautenberg, owners of the NY Mets and the Philadelphia Eagles as well as major markets throughout the world. Even one of Steven Spielberg’s charities has been exposed to the Madoff scandal. Read the reports below and see the slideshow:

Clusterstock has a comprehensive list of all of Madoff’s victims:

Word on the identities of Bernie Madoff’s clients / victimes continues to emerge. Please add new names to comments (or via email to hblodget@alleyinsider.com).

HSBC “has emerged as one the largest victims of Bernard Madoff’s alleged fraud with potential exposure of about $1bn to the investment manager’s collapsed venture…HSBC’s exposure stemmed from loans it provided to institutional clients, mainly hedge funds of funds, that wanted to invest with Mr Madoff. HSBC’s direct exposure is believed to be about $1bn in loans provided to clients who invested some $500m of their own funds in Mr Madoff’s venture. Under the typical terms of these deals, if the US authorities recover any funds from Mr Madoff, HSBC will be paid first, with its clients suffering the first tranche of losses.” (FT:)

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Director Steven Spielberg’s charity, Wunderkinder Foundation, “appears to have invested a significant portion of its assets with Mr. Madoff, based on regulatory filings,” according to the Wall Street Journal.
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The AP writes about world markets affected by Madoff:

Europe’s stock markets rose modestly Monday amid renewed hopes for a U.S. auto sector bailout, but the gains were limited by worries about the exposure of financial institutions to an alleged $50 billion fraudulent investment scheme in the U.S.

The FTSE 100 index of leading British shares was up 34.40 points, or 0.8 percent, at 4,314.75, while Germany’s DAX was 72.11, or 1.6 percent, higher at 4,735.48. The CAC-40 in France rose 20.30 points, or 0.6 percent, to 3,233.90.

Europe’s indexes were underperforming those in Asia. Tokyo’s Nikkei 225 index jumped 428.79 points, or 5.2 percent, to 8,664.66 points, and Hong Kong’s benchmark Hang Seng index added 288.56, or 2 percent, to 15,046.95 points

The Wall Street Journal writes about high profile individuals who were exposed to Madoff:

Investigators dug through financial records at Bernard Madoff’s investment firm as the list of victims of his alleged Ponzi scheme widened to include real-estate magnate Mortimer Zuckerman, the foundation of Nobel laureate Elie Wiesel, Sen. Frank Lautenberg and a charity of movie director Steven Spielberg.

…Monday morning in Tokyo, Nomura Holdings Inc. said its exposure to investments with Mr. Madoff totaled 27.5 billion yen ($302 million). A spokesman described …

Over the weekend, The New York Times reported more people involved, including the owners of the New York Mets.

The list of prominent fraud victims grew as well. According to a person familiar with the business of the real estate and publishing magnate Mort Zuckerman, he is also on a list of victims that already included the owners of the New York Mets, a former owner of the Philadelphia Eagles and the chairman of GMAC.

Fuente: http://www.huffingtonpost.com/2008/12/15/bernie-madoff-ponzi-schem_n_151018.html