Friday night, ABC's 20/20 aired an investigative report on Bernard Madoff that showed the former financier under house arrest in his luxurious apartment working on his Apple Macintosh computer and drinking a beer. At one point, Madoff gets up to fluff his pillows.ABC News set up a camera opposite Madoff's apartment on East 64th Street in Manhattan, and zoomed in on Madoff at night, sitting at his desk and facing a window.
"With his window shades up, ABC News cameras saw him spending hours on this computer, appearing to be on the Internet, and at other times talking into the computer. There is no restriction on his use of the computer or on computer phone connections, such as Skype," stated the investigative reporter Brian Ross who with his team has been on the hunt to figure out what Madoff did with the alleged $50 billion he lost.
What galls victims and the ABC news team is that Madoff is enjoying life in a penthouse prison while the victims are left desperate, facing foreclosures and some committing suicide. In addition, investigators tell 20/20 that Madoff has not fully cooperated in the search for the missing billions and has not revealed who else might have been involved in the global securities fraud.
I have mixed emotions over this video, which strikes me as an invasion of privacy. Though I realize there is outrage over Madoff's incarceration in a posh penthouse while some of his victims are selling their homes or applying for food stamps or worse, he still has rights.
Some of the bloggers on 20/20's site suggest that he go to a trailer park without a cell phone or computer and switch places with a family in Appalachia who was interviewed on a previous 20/20 program.
Meanwhile, bloggers on the 20/20 Web site bashed 20/20 for focusing on the rich and famous in Hollywood and Palm Beach as opposed to the ordinary folks who lost money with Madoff. We are told that Actor Kevin Bacon reportedly lost his life savings. 20/20 visits the home of Zsa Zsa Gabor, "the Paris Hilton of her day," who is 92 and confined to wheelchair. She doesn't appear on camera, but her husband, Prince Frederick Von Anhalt, tells 20/20's Brian Ross, that they lost their entire $10 million life savings with Madoff. "I would like to squeeze him," Anhalt tell's 20/20's Ross. Donald Trump also weighs in on the commotion that erupted when Robert Jaffe, a financial executive with Cohmad Securities, and a major door-opener for Madoff, walked into Trump's fancy Mar-a-Lago Club and angry investors confronted him.
On the same day, this program aired, victims attended a meeting with the court-appointed bankruptcy trustee who is selling the Madoff business. At this meeting, investors learned they would be asked to return false profits they made with Madoff. Since there was no stock bought or sold and all the trades were made up, if they received profits, it was somebody else's money, an attorney working on the liquidation of Madoff's business, tells 20-20. One investor attending the meeting told ABC News that she was on food stamps. She may have been one of the ordinary folks they should have interviewed!
Speculation as to whether or not Madoff acted alone in the Ponzi scheme comes up several times in the 20/20 program which shows close-ups of the customer statements detailing phony trades in blue-chip stocks. Suzanne Murphy, an analyst who reviewed Madoff's returns and told her clients not to invest, says there's not a chance he acted alone. There was "too much paper and too many customers that had to be serviced," said Murphy.
The highlight of the program is a former Madoff employee, Nader Ibrahim, who worked on computers at Madoff's offices in the Lipstick building, and left the firm four years ago. He points out that Madoff was away for several months at a time when he worked there, and that he was in retirement mode, so the day-to-day running of the business was left to his brother and sons. However, the reliability of the former employee is called into question by industry sources. These sources told Advanced Trading that Ibrahim performed desk-top support at Madoff's firm where he set up PC's, switched out screens, did some basic connectivity setup work and "took several hard-drives before he left." Ibrahim also gave an interview to FOX Business News that is on the Huffington Post site. Huffington Post is reporting that Ibrahim recently handed over a hard drive belonging to Ruth Madoff, Bernie's wife, to a plaintiff's attorney representing some $2 billion in losses resulting from Madoff's alleged fraud. To watch that interview, click here.Friday night, ABC's 20/20 aired an investigative report on Bernard Madoff that showed the former financier under house arrest in his luxurious apartment working on his Apple Macintosh computer and drinking a beer. Ivy is Editor-at-Large for Advanced Trading and Wall Street & Technology. Ivy is responsible for writing in-depth feature articles, daily blogs and news articles with a focus on automated trading in the capital markets. As an industry expert, Ivy has reported on a myriad ... View Full Bio