HOW'D HE DO THAT?
The Securities Investor Protection Corp (receiver of Madoff's now-defunct fund) is examining Madoff's New York Mellon Bank accounts that appear to have sent and received money from offshore locations..........
Signicantly many of the entities invested with Madoff are tax-exempt non profit "charities and foundations"---which the IRS has labled as massive tax evasion schemes.
To pull off a $50 billion scheme, the Madoff cabal would have had to involve investors, relatives, associates, co-conspirators (or subsets of them), businesses and tax-exempt organizations........colluding together with similar goals like tax evasion and money laundering.
Madoff may have escaped scrutiny by routing his scheme through telephone lines with a maze of complex telecommunications' systems equipped with call-forwarding and voice mail systems, and numerous postal and commercial mail boxes..........and perhaps unregulated money-transfer systems that operate below the oversight radar in ethnic enclaves and places like NYC's Diamond District.
The "investment" monies could have been disguised (to evade the IRS) by routing through a network of domestic and international bank accounts using counterfeit checks.....opening commercial bank accounts in the name of bogus businesses and wire-transferring and/or depositing "investment" checks into those accounts.
The checks could have had invalid bank routing numbers, forged endorsements, or been drawn on the proceeds of other counterfeit checks deposited in other bank accounts. Before banks discovered the fraud, the funds might have been transferred out of the accounts……probably offshore----leaving banks unable to recoup their losses.
State and federal tax authorities could have been swindled, if the scheme involved filing hundreds of phony tax returns in real or fictitious names, falsely claiming federal EITC credits (meant to benefit low-income earners).
Madoff might have manufactured falsified “loss statements” as a tax evasion ploy.
In an international scheme with offshore ties, the co-conspirators or subsets of them might have obtained hundreds of taxpayer identification numbers for phantom citizens with worldwide addresses, and used the information, along with phony passports, to claim hundreds of bogus tax refunds.
Investigators poring over Madoff's books have discovered he routinely falsified documents. Using classic fraud techniques, Madoff kept two (or more) sets of books. One set keeps track of losses at Bernard L. Madoff Investment Securities LLC's (his investment advisory arm), while the other set of books is what investors were shown.
NOTE The SIPC is financed by the securities industry and hands out reimbursements to investors who lost money through LEGIT brokerages. It was not intended to reimburse individuals involved in shady schemes with people like Madoff.
Another way to hide monies is donation of property to tax-exempt non-profits---the scam relies on inflating the cost of the land on the books.
Ira Rennert, Fifth Avenue Synagogue board chair invested some $200 million w/ Madoff.
Hamptonites complain this astoundingly palatial mega-mansion in the posh Hamptons is actually a tax-exempt "synagogue-residence-yeshiva" for Orthodox Judaism students. The complex---which rivals Versailles and Buckingham Palace----was built by Fifth Avenue Synagogue board chair Ira Rennert.
Is this astoundingly palatial oceanfront Hamptons mega-mansion
a tax-exempt "synagogue-residence-yeshiva" for Orthodox students?
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It is also believed that J. Ezra Merkin, Fifth Avenue Synagogue president, had about $1.8 billion invested w/ Madofff through Mr Merkin‘s Ascot Partners fund. Members of the Fifth Avenue Synagogue, located on the wealthy Upper East Side of Manhattan, are estimated to have invested some $2 billion w/ Madoff. Merkin was also Chairman of Yeshiva University Investment Committee, He introduced clients to Madoff and gave him access to prominent Jewish charities and universities.......the entities were all Orthodox religionists.
MADOFFIAN MERKIN COULD HAVE FOUND ANOTHER WAY TO HIDE MONIES Excerpt---Upper East Side investor Erza Merkin is being pressured to step down as chairman of GMAC, the troubled auto- and mortgage-lender which received a $6 billion government rescue package. The pressure comes as Uncle Sam entrusts a trunkload of cash to Merkin, whose Gabriel Capital Group's Ariel Fund was one of the largest funds feeding money to alleged Ponzi scheme fraudster Bernie Madoff.
Merkin's fund had $1.8 billion invested with Madoff. Neither GMAC or the Treasury Dept is talking about how Merkin was allowed to stay atop the privately-held GMAC operation despite his cloudy recent history - which has been marked by several lawsuits charging the 53-year-old investor with fraud.
Merkin, who lives in the tony 740 Park Avenue building, told investors in December that his $1.8 billion Ascot Partners LP fund had invested nearly all its assets with Madoff - and had lost it all. Ascot was one of several funds under Gabriel Capital Group, which had a total of $5 billion in assets under management. Investors who had entrusted their money to Merkin - that Merkin placed with Madoff - include New York University, Yeshiva University, New York Law School and Tufts University.
Bernanke, Paulson, Merkin.