June 30th, 2017

Ruth Madoff today

Here’s a story about Ruth Madoff’s life these days. My question is: why the story, and in particular why the need to reveal where she lives? So people can harass her even more than they already do?

I’ve written about the Madoff relatives and my opinion about their guilt or innocence. I’m not going to rehash that argument again, except to say I have never wavered from the idea that they had no idea what was going on. I’ve seen zero credible evidence to dissuade me from that viewpoint. I see the sons as having been among Madoff’s most heartbreaking victims, since he betrayed them both in the fiduciary sense and as a father and as a person. The same for his wife Ruth, only substitute “husband” for the word “father.”

But people continue to want to blame. I think they’re really saying some form of “I would have known. I would be smart enough to know. No one can put anything over on me.” But my belief in the (now-deceased) sons’ innocence and my belief in Ruth Madoff’s innocence is not naivete on my part. It’s actually the opposite: a profound appreciation for how secretive and successfully psychopathic some people can be.

You know what’s naive? Statements such as this, found in the article:

“How do you sleep with a man for all those years and don’t know what he is up to?” asked an Old Greenwich shop owner who did not want to be identified because Ruth frequents her store. “I just don’t buy the story that she knew nothing, and that she’s had a hard time. She hasn’t been through what half the people went through. People committed suicide because of the Madoffs. Please!”

One of those people happened to have been the older of Ruth Madoff’s two sons.

What’s more, thinking that if you sleep with someone for decades you must know all there is to know about them is naive. Some people have huge secrets, and even a completely secret life. It’s a combination of arrogance and stupidity to think otherwise. As though sleeping with someone tells you their business secrets!

Try sleeping with a sociopath, or a spy. See how much you find out.

I see Ruth Madoff as a tragic figure. She married her high school sweetheart when neither had any money to speak of. He did well—very well—and she had a good ride for quite a while. By all accounts, she was the “people person” in the marriage, the warm one as opposed to Madoff’s coldness. Their two sons gave them plenty of nachas, too.

And then it all fell through, suddenly and spectacularly and publicly. Ruth Madoff is no heroine—far from it. She actually seems rather ordinary as a person, at least that’s what I’ve observed. But her tale has all the marks of tragedy: a rise to spectacular heights and then a huge fall, betrayal by the man she had trusted and loved her entire adult life, the death of both her sons, disgrace, and the hatred of much of the world.

It’s a lot. No wonder she compulsively walks the streets of the suburban town where she lives.

32 Responses to “Ruth Madoff today”

  1. Frog Says:

    Our social viciousness and vindictiveness increases daily.
    Where does the responsibility for this reside?
    Not in Christianity, which is also shrinking throughout the civilized world.

  2. vanderleun Says:

    Sometimes I think that I am indeed sleeping with a sociopath, but then I wake up and I’m the only one there.

  3. Ray Says:

    Preet Bharara, the former U.S. Attorney for the Southern District of New York, prosecuted J.P. Morgan for $2 billion in damages for failing to uncover the fraud of Bernie Madoff. Now of course the SEC couldn’t find the fraud and thought Bernie was a genius, but J. P. Morgan was supposed to detect the fraud.

  4. T Says:

    “But her tale has all the marks of tragedy . . . .”[Neo]

    and that would be tragedy in the traditional Greek sense, especially as you describe it here.

  5. The Other Gary Says:

    But people continue to want to blame. I think they’re really saying some form of “I would have known. I would be smart enough to know. No one can put anything over on me.”

    Some people have huge secrets, and even a completely secret life. It’s a combination of arrogance and stupidity to think otherwise. As though sleeping with someone tells you their business secrets!

    I believe some portion of the resentment towards Ruth Madoff can be explained by “I would have known” and “a combination of arrogance and stupidity.” But I think a larger part is simply the sadistic desire for a scapegoat to kick around.

    One very striking feature of the whole Madoff scandal was the extreme degree of mass outrage generated. There have been serial murderers who have slipped by without achieving the level of public wrath directed at Madoff. And some of these murderers had associates who either knew or assisted (eg helping hide evidence) who haven’t been subjected to the kind of indignation directed at Ruth Madoff. A bit puzzling, eh?

  6. Tatterdemalian Says:

    People can’t accept that monetary value is imaginary, unlike mass, distance, and time. Wealth can be created and destroyed, but everyone wants to think the money the Madoffs destroyed with their pyramid scheme is actually hidden away somewhere, and if they can just wring the information out of whoever is hiding their stash, they can maybe get some of it back.

    But the money is gone forever, because it retroactively ceased to exist the moment they spent it on a boondoggle.

  7. groundhog Says:

    If there was no need to tell anyone close to him, it certainly doesn’t make any sense to do so. More people that knew, the more risk of slipping up.

    Besides I’d much rather have my spouse think I was a brilliant investor than a crook.

  8. Frank Says:

    If you ever had a job at a firm where securities trading took place and you had any involvement in the trading itself, trade booking, confirmation, clearing, reconciling or accounting for the trading activity, you’d know that it would be impossible to put fake trades over on your co-workers. Everyone had to know it was BS. The couldn’t have possibly hired anyone from the outside to work there. Maybe the non-business involved employees, like admins and IT staff, didn’t know. Everyone else did. If Ruth wasn’t involved in the business she may not have know. The sons ? Forget it, they were 100% in on it.

  9. Big Maq Says:

    “‘“How do you sleep with a man for all those years and don’t know what he is up to?”'” – Neo (quoting Madoff’s son)

    I often hear a similar argument wrt families of terrorists.

    It is conceivable even if it is hard to imagine in one’s own life.

  10. neo-neocon Says:

    Frank:

    You’re seem unaware of the way Bernie Madoff’s business was set up.

    There WERE very few if any knowledgeable “co-workers” except one guy, Frank DiPascali, who has also been charged, and perhaps Madoff’s brother Peter, who has also been charged with involvement (although somewhat lesser involvement).

    The sons had a completely different and separate business and were given no information and no access to Bernie’s business. The separation also included physical separation—their businesses were on one floor and Bernie’s on another, and they weren’t even allowed on that floor (17th floor). Bernie also used a separate, ancient computer to conduct his business, and they were not privy to it.

    There was never a scintilla of evidence to support charges against them.

    See this and this.

  11. neo-neocon Says:

    Big Maq:

    I don’t find it the least bit hard to imagine

    People have secrets all the time. And sex is not a truth serum—it doesn’t make a person divulge his/her secrets.

    I don’t know about you and your own pillow talk, but mine doesn’t ordinarily include politics or finances.

  12. John Guilfoyle Says:

    “I don’t know about you and your own pillow talk, but mine doesn’t ordinarily include politics or finances.”

    More info than I was looking for on a sunny Saturday morning.
    😉

  13. T Says:

    “If you ever had a job at a firm where securities trading took place and you had any involvement in the trading itself . . . you’d know that it would be impossible to put fake trades over on your co-workers . . . ” ]Frank @ 4:51]

    Frank,

    Your point is that if one knows how securities trading is done, one would know that Madoff’s scam could not go unnoticed. The thing about a scam, however, is that scams don’t work the way business is normally done. They circumvent the normal order of business one way or another.

  14. huxley Says:

    I remember a chilling interview on NPR of an East German human rights activist. After the Wall came down, she discovered her husband had been a Stasi informer reporting on her throughout their marriage.

    I guess it was this woman, Vera Wollenberger.

    http://www.nytimes.com/1992/04/12/magazine/east-germans-face-their-accusers.html?pagewanted=all

  15. AesopFan Says:

    Ray Says:
    June 30th, 2017 at 3:22 pm
    Preet Bharara, the former U.S. Attorney for the Southern District of New York, prosecuted J.P. Morgan for $2 billion in damages for failing to uncover the fraud of Bernie Madoff. Now of course the SEC couldn’t find the fraud and thought Bernie was a genius, but J. P. Morgan was supposed to detect the fraud.
    ** *
    Adding to the impression that Bharara is another of those legal-beagle stars touted for integrity and “going after the crooks” — who have feet of clay after all.

    https://www.realclearpolitics.com/articles/2017/05/21/when_comey_and_mueller_bungled_the_anthrax_case_133953.html

    “The third and most important factor tempering my enthusiasm for the new special prosecutor is that Comey and Mueller badly bungled the biggest case they ever handled. They botched the investigation of the 2001 anthrax letter attacks that took five lives and infected 17 other people, shut down the U.S. Capitol and Washington’s mail system, solidified the Bush administration’s antipathy for Iraq, and eventually, when the facts finally came out, made the FBI look feckless, incompetent, and easily manipulated by outside political pressure.”

  16. huxley Says:

    AesopFan: Yes, the anthrax failure was the first red flag I saw with the Mueller/Comey connection.

  17. blert Says:

    From the royal courts of history we know that the truly wealthy live different lives: they travel in different social circles from each other — most of their days.

    Beyond that, money issues never come up.

    She has no access to his books, nor any reason to question his business or financial judgments. Everywhere she turns, society reinforces the notion that everything is tip top.

    So, whatever bedroom conversation they’ll ever have must revolve around family and emotions — NOT finance.

    It’d be easy for Madoff to keep her totally in the blind.

    J.P. Morgan’s problem is that they are looking directly at his accounts. That institution really has no excuse.

    A first year clerk could see that Madoff was running a Ponzi.

    By the end, Madoff was booking more profits from his fictitious trades than the entire exchange could’ve generated.

    He was showing a million times as much activity in this or that option as the exchange could’ve traded.

    For his trades were ZERO-SUM trades. He needed the Other Guys to be losing, month in and month out, astounding amounts of money.

    As the recent collapses of this or that hedge fund reveal, no-one can stay in the game losing that kind of money. They run out of chips.

  18. Sharon W Says:

    I agree with everything you wrote, Neo. I watched the Frontline on the Madoff scam, twice. One of the most fascinating episodes I’ve seen. The psychology of people when it comes to money–distinct. BTW-the scam was uncovered years before and the SEC tipped off-given the exact information and when they originally “investigated” they, too, succumbed to the intimidation of Bernie Madoff.

  19. Frog Says:

    Sharon: the SEC “succumbed to the intimidation of Bernie Madoff”? Intimidation??

    Stuff like this goes on all the time. Madoff was simply the most successful, for the longest time.
    It always boils down to “If it’s too good to be true, it probably isn’t.”

    Refer back to the Allen Stanford case circa 2009 and the consistently higher-than-market returns which Stanford International Bank (on Antigua) claimed to make for its depositors. Several people I know well parked millions with Stanford, lost every penny. None did due diligence, just took the word of a friend that the yields were great, as Stanford claimed several % points higher yield than anywhere in the USA, with absolute safety. Nutty.

    That is how every Ponzi scheme works, via laziness and greed.

    We really need not give it any more thought than that.
    And there are far greater tragedies than what befell Ruth.

    If that seems harsh, it needs to be.

  20. Ymar Sakar Says:

    Christianity is a shell of its former self. Can’t do much without the original 1st century AD divine powers and supernatural abilities.

  21. Ymar Sakar Says:

    Madoff made off with a lot of money. He didn’t have as powerful a spirit helping him as soros had, hoewver.

  22. Ymar Sakar Says:

    Americans get fooled by their politicians and institutions all the time. yet they expect other humans to be perfect. A bit of hypocrisy in this nation of bhaal baby sacrificing worshipers.

  23. Sean Says:

    Mark Madoff’s death was truly sad. To have his father bring shame on the whole family like that, especially when by all accounts he was doing a stand-up job with his own part of the family business, and then to have his own kids get sued by Madoff’s investors afterwards… Must have been hard for a man with integrity.

    I imagine it’d be easy for anyone living in the lap of luxury to have the wool pulled over their eyes by the person providing it for them. Most people wouldn’t ask questions about where the money came from, especially when the answer would involve something as esoteric as finance.

  24. neo-neocon Says:

    Sean:

    Actually, the sons DID ask their father questions about his end of the business, which was separate from theirs. Their money was coming from their own end of the business, and they fully understood at that point where their own money was coming from. But when they asked him to show them the ropes of his separate business, the one on the 17th floor (theirs was on the 18th and 19th), he refused and said it was none of their business. Since it was a separate entity that belonged to him, not to them, there was nothing they could do to force him to tell them.

    I can’t provide a link because I no longer remember where I got that information. I’ve read so much about the case over the years, and watched several documentaries on it, that I don’t recall exactly.

  25. Sean Says:

    neo,

    Actually, the sons DID ask their father questions about his end of the business, which was separate from theirs. Their money was coming from their own end of the business, and they fully understood at that point where their own money was coming from

    Yeah, I got that. Most of what I know comes from the ABC mini-series a year or two back. But I meant the second paragraph in response to people doubting Ruth’s innocence, not his sons’. Ruth is a bit of a sad figure, but I can see why folks would be disinclined to cut her any slack, even if she wasn’t fully aware of what was going on. The real tragedy (besides all the people he defrauded) was what he did to his sons.

  26. Sean Says:

    But when they asked him to show them the ropes of his separate business, the one on the 17th floor (theirs was on the 18th and 19th), he refused and said it was none of their business. Since it was a separate entity that belonged to him, not to them, there was nothing they could do to force him to tell them.

    The other thing is that Mark was running a legit business, even if it was small-fry by Wall Street standards, but it was profitable. And by the sounds of things, Bernie held it in contempt.

  27. Sergey Says:

    Secrecy and double life are heavy burdens on any normal people. That is why confessions happen and are made a public institution to alleviate these burdens. But psychopaths are different: they did not experience such things as burdens, being completely devoid of conscience, but also actually enjoy this situation and thrive on it.

  28. The Other Chuck Says:

    In the long run how is what Madoff did any different than the federal governments ponzi of Social Security?

  29. Big Maq Says:

    “People have secrets all the time. And sex is not a truth serum—it doesn’t make a person divulge his/her secrets.

    I don’t know about you and your own pillow talk, but mine doesn’t ordinarily include politics or finances.” – Neo

    Yes.

    But, my point is that a similar argument is made (or harbored) about terrorists and their families and neighbors.

    And, if it is true that even the most intimate of relationships is no guarantee that one can know all that most of us might think they ought to know, then, it is quite conceivable that those another step or two removed may not know either.

  30. Big Maq Says:

    “In the long run how is what Madoff did any different than the federal governments ponzi of Social Security?” – Other Chuck

    Yes it is. Quite different!

    Madoff hid it.

    Soc Sec is out in the open, and knowable to anyone who cares to look.

    This is not much different than public sector pension plans (also underfunded), most of the recipients “believe” they are entitled to the payouts, so they ignore the warning signs or concerns expressed, perhaps thinking that someone else (a future taxpayer) will pick up the tab.

    It is unpopular to cut benefits or to raise taxes, so politicians ignore discussing the topic. For similar reasons, news media largely ignore the topic, and it only gets significant airtime when it culminates in a crisis (e.g. Illinois state recently).
    .

    Noticed a small national story where, in Texas, the legislature “bailed out” (my guess) the Dallas Fire and Police pensions. The issue, very surprisingly, was initially raised by the Mayor, who was embroiled in a drawn out fight with the unions (I think he is a dem, btw – so he is acting rather responsibly!).

  31. The Other Chuck Says:

    Social Security may be out in the open, contra Madoff, but it’s still a ponzi. The trust fund is totally “invested” in Treasuries, which means one branch of government is simply borrowing from another branch. Starting in 2020, less than 3 years away, the taxes supporting current payouts will be less than needed. At that time the Treasury notes will start to be redeemed. That will supposedly cover future obligations until 2034. If there is no reform by then, benefits will be paid out at 75 cents on the dollar, and will continue to decline.

    http://www.cbpp.org/research/social-security/policy-basics-understanding-the-social-security-trust-funds

  32. Ymar Sakar Says:

    Madoff was small enough to fail and he didn’t sacrifice enough children for Lucifer’s spirit to help him out, as Soros was helped. That is why he is different from government nimrod pyramid schemes. The latter are TOO BIG TO FAIL, because the supernatural forces propping them up are pretty powerful.

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Previously a lifelong Democrat, born in New York and living in New England, surrounded by liberals on all sides, I've found myself slowly but surely leaving the fold and becoming that dread thing: a neocon.
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