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Carl Shapiro’s Madoff accounts questionedFeds probe Boston donor
Boston Herald ^ | Tuesday, May 19, 2009 | By Jerry Kronenberg

Posted on 05/19/2009 7:08:46 AM PDT by ninonitti

Top Boston philanthropist Carl Shapiro is reportedly facing a criminal probe into his ties to Bernard Madoff, although experts say it’s not clear the 96-year-old Hub man will ever face charges.

“When you hit 96, I think you get some immunity,” said Willis Riccio, former New England chief of the U.S. Securities and Exchange Commission.

The Wall Street Journal reported yesterday that Shapiro is one of at least eight Madoff associates targeted by a probe into Madoff’s $65 billion Ponzi scheme. Others include Shapiro’s son-in-law Robert Jaffe - a part-time Weston resident who allegedly served as Madoff’s Hub salesman - and accountant Frank Avellino, who maintains a Nantucket home.

Citing unnamed sources, the Journal said the New York U.S. Attorney’s office has uncovered documents suggesting Shapiro and other big Madoff investors knew their returns were fraudulent.

The paper said authorities believe some players got specific percentage returns that were agreed to in advance. That would suggest investors realized Madoff, who pleaded guilty in March and faces sentencing next month, was running a scam.

Shapiro and Jaffe have long denied any involvement in Madoff’s scheme. “Carl and Bob were victims and had no knowledge of any fraud,” family spokesman Elliot Sloane told the Herald yesterday.

Shapiro, a long-time Madoff friend, faces scrutiny even though he and his family’s foundation are said to have lost some $550 million to the scam. That reportedly includes $250 million Madoff tricked Shapiro into investing just days before the Ponzi scheme collapsed.

Shapiro, a retired clothing magnate, is one of Boston’s biggest philanthropists. He and his wife’s foundation have donated millions over the years to Beth Israel Deaconess Medical Center, Brandeis University, the Museum of Fine Arts and dozens of other Hub nonprofits.

Jaffe, who splits his time between Weston and Palm Beach, Fla., worked for Cohmad Securities, a Madoff “feeder firm” that connected investors with the now-disgraced financier.

Experts say investigators have probably found paperwork that authorities believe points to wrongdoing by Shapiro and the others. But former prosecutors say actually getting convictions could prove difficult.

“It’s a big step to say someone was aware of criminal activity just because they wanted bigger returns,” Riccio said. “Most of us would want bigger returns if we could get them.”

Another former white-collar-crime prosecutor, who spoke on condition of anonymity, said the government must prove “willful blindness” to convict Shapiro and the others.

“That means you knew - or should have known - that something was wrong, but you turned a blind eye to it,” the lawyer said.

While Riccio believes advanced age and major charity work will prevent authorities from charging Shapiro, the other former prosecutor interviewed by the Herald isn’t so sure.

“My experience in cases where victims have lost a lot of money is that they’ll put the screws on prosecutors,” the lawyer said. “Victims who’ve suffered a lot consider everybody fair game. If a guy has four years to live, they want him to go to (jail) for two.”

Also yesterday, the trustee liquidating Madoff’s defunct money-management firm filed a so-called clawback lawsuit against three Fairfield Greenwich Group hedge funds, seeking the return of $3.54 billion withdrawn before Madoff’s massive fraud unraveled.


TOPICS: Business/Economy; Crime/Corruption; News/Current Events
KEYWORDS: boston; cultureofcorruption; democratscandals; jaffee; madoff; oldmoney; shapiro
Carl, time to check into the Carl and Ruth Shapiro Cardiovascular Center at Brigham and Woman's? Oooops they're not happy with you coming up short on your pledges to them?

Philanthropy is easy when Bernie is supplying you with other peoples money to be a generous with.....how veryliberal of you.

A heart attack might be a good career move - you could continue your victimhood into the next life.

1 posted on 05/19/2009 7:08:47 AM PDT by ninonitti
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To: Liz

FYI..


2 posted on 05/19/2009 7:21:04 AM PDT by ken5050
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To: ninonitti
“When you hit 96, I think you get some immunity,” said...

You may, but your money won't.

3 posted on 05/19/2009 7:34:23 AM PDT by randog (Tap into America!)
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To: ken5050; CutePuppy
Thanks for the heads-up.

.........investigations now include investors who "claimed" to be hardest-hit victims, both directly and through their foundations.........

Course, everyone knows that I’m really, r-e-a-l-l-y humble. So I could n-e-v-e-r bring myself to say "I told you so." ROTFL.

WSJ, May 19, 2009, by Amir Efrati
Prosecutors are continuing to probe Madoff family members and employees, but the investigation now includes investors who have claimed to be among the hardest-hit victims of the fraud, both directly and through their foundations. Mr. Madoff pleaded guilty in March and is set to be sentenced in June. Aiding investigators is their discovery that Mr. Madoff was a "meticulous" record keeper who kept correspondence between some clients and the firm, said people familiar with the probe.

===========================================

Ut oh---a paper trail. Didn't Madoff's lawyers ever tell him---"never write anything down." LOL. Betcha Madoff's (cough) "investors" are getting real nervous.

===============================

AT WSJ WEB SITE (subscribers' access)

WSJ Video 1: Inside the Madoff Scandal: Chapter One

WSJ Video 2: Chapter Two: Unwinding the Money Trail

Fairfield Is Sued by Madoff Trustee for $3.54 Billion - BL, May 18, 2009

4 posted on 05/19/2009 7:40:33 AM PDT by Liz (Everything Obama says comes with an expiration date.)
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To: ninonitti
Top Boston philanthropist Carl Shapiro is reportedly facing a criminal probe into his ties to Bernard Madoff, although experts say it’s not clear the 96-year-old Hub man will ever face charges.

“When you hit 96, I think you get some immunity,” said Willis Riccio, former New England chief of the U.S. Securities and Exchange Commission.

There are people who've died waiting to go to trial. Let him spend the last 4 years of his life dealing with the stress of legal investigation if it is warranted. No "immunity". And don't be afraid to confiscate any ill gotten wealth. Why should he be able to live out his days high on the hog if the money was stolen?

5 posted on 05/19/2009 7:51:57 AM PDT by a fool in paradise (If you like the Dept. of Motor Vehicles, the IRS, and the Post Office, you'll love govt Health Care)
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To: All
WSJ reported Shapiro is one of at least eight Madoff associates targeted .......includes his SIL, Robert Jaffe - a part-time Weston resident who allegedly served as Madoff’s Hub salesman - and accountant Frank Avellino. ..... WSJ said the NY U.S. Atty’s office has uncovered documents suggesting Shapiro and other big Madoff investors knew their returns were fraudulent. and that some players got specific percentage returns that were agreed to in advance. That would suggest investors realized Madoff was running a scam.

HOW'D HE DO THAT? To pull off a $65 billion scheme, the Madoff cabal would have had to involve investors, relatives, associates, co-conspirators (and/or subsets of them), businesses and tax-exempt organizations........all with similar goals.

HUGE RED FLAG Some investors were writing personal checks to Madoff.

It is commonly agreed that Madoff was not investigated b/c within L/E circles it us not advisable to suggest someone of Jewish heritage is doing something illegal---in fact, it is a career killer.

Madoff may have routed 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 money-transfer systems that operate 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.

Checks one foundation wrote to another foundation should be scrutinized..... could involve the biggest frauds, in the form of tax evasion, money laundering, etc.

Madoff's phony 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).

In an international scheme with offshore ties, the Madoff 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 in a fraud that could take months to unravel. In a classic fraud MO, 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 consisted of "investors" writing Madoff personal checks.

Madoff's methods may have included limited-recourse loans to artificially inflate "asset value," so that he could fraudulently borrow real money based on “assets” that didn’t really exist.

Madoff's Web site claimed the firm was technologically-advanced, however investigations found the firm sent paper confirmations of trades via US mail at the end of each day, rather than providing electronic access to this important information. Paper copies provide a hedge-fund manager with the end-of-the-day ability to manufacture trade tickets that confirm the investment results.

It could be postulated that most of his investors figured Madoff was doing something illegal---Wall Street was whispering Madoff was laundering proceeds from Russian mob activities.

If Madoff was helping gangsters steal, some investors might have figured they could make a profit on the deal.

6 posted on 05/19/2009 7:55:37 AM PDT by Liz (Everything Obama says comes with an expiration date.)
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To: ninonitti
"When you hit 96, I think you get some immunity."

Unless you're John Demjanjuk.
7 posted on 05/19/2009 7:56:47 AM PDT by HelenChicago
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To: ninonitti

WSJ had an article thank Shapiro and Stanley Chasis among maybe a few others could tell Bernie what return they wanted. In some cases they got 200%. Anyone telling Bernie the return they wanted knew it was a scam.

Bernie was such a good pal to the Democrat Party. Most of his investors were ripped off by the people on the top of the pile - Bernie, Shapiro, Merkin, Chasis, et al. The invetsors thought Bernie could front run too.


8 posted on 05/19/2009 8:08:00 AM PDT by Frantzie
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To: ninonitti
“When you hit 96, I think you get some immunity,”

Tie him to a stake and get the Scottish guy!

Put it on pay per view!

9 posted on 05/19/2009 8:23:17 AM PDT by Anti-Bubba182
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To: Liz

“through their foundations’ aka tax scams.

My guess is these tax foundations were non-profits where the investment gains were not taxable and the people running the foundations pulled money out that was not taxable or maybe as taxable salaries. My guess is a LOT of their expenses paid with the money. This is how liberals avoid paying taxes.


10 posted on 05/19/2009 8:31:17 AM PDT by Frantzie
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To: HelenChicago
Unless you're John Demjanjuk.

Ethnically challenged?

11 posted on 05/19/2009 8:33:49 AM PDT by ninonitti
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To: ninonitti

Lets just hazard a guess! Carl and his Wifey were huge Contributors to both Hitlery and ZERO HUSSEIN????? And Eric Holder is on a personal Retainer to Carl? Birds of a Feather stick together, so they say:-)


12 posted on 05/19/2009 9:10:19 AM PDT by True Republican Patriot (GOD BLESS AMERICA and Our Last Great President George W. Bush)
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To: Frantzie; Grampa Dave
....foundations were tax-exempt non-profits .........investment gains were not taxable....the people running them pulled money out as taxable salaries.....plus expenses.... This is how liberals avoid paying taxes.

N/P's are FReeper Dave's pet peeve.

The IRS has pinpointed foundations as the locus classicus of tax evasion.

There's a zillion ways they evade taxes within a foundation---and live the high life---tax-free.

13 posted on 05/19/2009 10:14:31 AM PDT by Liz (Everything Obama says comes with an expiration date.)
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To: Liz

One of your quotes from the article:

“Investigators poring over Madoff’s books have discovered he routinely falsified documents in a fraud that could take months to unravel.”

I bet the full picture will take years to put together, if it is even possible.


14 posted on 05/19/2009 10:17:52 AM PDT by FreedomPoster (Obama: Carter's only chance to avoid going down in history as the worst U.S. president ever.)
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To: True Republican Patriot

Bernie sure was. When this story broke here at Free Republic, I searched for his contributions and posted them in one of the first threads. His political giving was heavily, almost entirely, to Dem candidates.

They should be pressured to give that money back to the fund for the victims of his scam.


15 posted on 05/19/2009 10:20:44 AM PDT by FreedomPoster (Obama: Carter's only chance to avoid going down in history as the worst U.S. president ever.)
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To: FreedomPoster
“Investigators poring over Madoff’s books have discovered he routinely falsified documents in a fraud that could take months to unravel.”...........I bet the full picture will take years to put together, if it is even possible.

The whole point, of course---to protect his "investors."

16 posted on 05/19/2009 10:24:30 AM PDT by Liz (Everything Obama says comes with an expiration date.)
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To: ninonitti
WSJ reported that Shapiro is one of at least eight Madoff associates targeted by a probe into Madoff’s $65 billion Ponzi scheme. Others include Shapiro’sSIL--- Robert Jaffe---- a part-time Weston resident who allegedly served as Madoff’s Hub salesman

I GUESS THIS ITEM COMES FROM ONE OF THOSE HATE-FILLED ANTI SEMITIC WEB SITES (/sarc)

Robert M. Jaffe, the broker who steered many wealthy investors to Bernard Madoff's investment fund through both New York-based Cohmad Securities Corp., partly owned by Madoff and of which Jaffe is a vice president, and Jaffe's own Palm Beach-based M/A/S Capital Corp, previously "did business with another notorious rogue: former Boston mob leader Gennaro Angiulo."

Jaffe, under investigation for his ties to the Wall Street investor who authorities say confessed to running a Ponzi scheme, was the stockbroker to Angiulo and his brothers, reputed members of the Boston Mafia, before they were sent to jail on racketeering charges in 1986. He first represented the Angiulos when he worked at the investment firm E.F. Hutton in the 1970s, and the Angiulos followed him when he became the Boston branch manager at Cowen & Co. in 1980, according to a Boston Globe article in 1985 that quoted Cowen's lawyer, Lawrence Leibowitz.

NOW HE'S BEING CURSED Post-Madoff, Bob Jaffe was called a "dirty bastard" and nearly pummeled at posh Mar-a-Lago by Nine West shoe chain founder Jerome Fisher, who lost $150M with Madoff.

Laurence Leamer, who authored a book about the Palm Beach denizens, labeled Jaffe (a former Boston shoe salesman who inveigled the rich to invest with Madoff) "a 60-something peacock in a black dinner jacket....[with] an aging gigolo's looks, and a face that looks like a caricature of youth."

Ellen Jaffe is trying to ditch Leamer's March 16 book lecture, "Madness Under the Royal Palms," at the Kravis Center. His rep said Jaffe has not had plastic surgery, that he's been married 40 years and still "very much in love. Jaffe's name has been mud since the Madoff scandal broke.

===================================

Hmmmmmmmm.......where have I heard that song before? "The Jaffes have been married 40 years and are still very much in love." QUESTION When Mrs Jaffe goes on one of her all-day shopping excursions----does Mr Jaffe's manicurist make a (cough) house call?

Bob and Ellen Jaffe and the wonders of plastic surgery.

17 posted on 05/19/2009 10:32:05 AM PDT by Liz (Everything Obama says comes with an expiration date.)
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To: ninonitti

Go after his family!


18 posted on 05/19/2009 12:08:12 PM PDT by wolfcreek ("unnamed "right-wing extremist")
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To: HelenChicago

well played


19 posted on 05/19/2009 12:45:59 PM PDT by nkycincinnatikid
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To: Liz
LOL verrrrrrrry catty Liz. 40 years? Something John Kerry aspires to - good work if you don't mind the work. Jaffe is a real piece of work in his own personna and will be eagerly sought after if ever lands in the hoosegow - he's just so darned pretty - he's going to make some inmate a very good wife.

The Mass Secretary of State has been on Jaffe since Bernie got religion and would like to see him up on state charges. That of course would be different than a stretch in the federal pen where he'd probably get to keep his smoking jacket and silk pjs. He's very wired into the the Chestnut Hill/Weston crowd (think Schusters) so they'll be pulling all the strings for Ellen's (the poor thing! beau.

20 posted on 05/19/2009 4:55:40 PM PDT by ninonitti
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To: ninonitti
I grew up next door to a guy who,along with other members of his family,was one of Madoff’s bigger victims.Haven't talked to him for years but I still have a friend in the neighbor who's heard that they were hit *big*.Couldn't happen to a more deserving fella.....never did like him...although I liked his father.
21 posted on 05/20/2009 8:47:15 AM PDT by Gay State Conservative (Christian+Veteran=Terrorist)
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To: ninonitti
……Jaffe is a real piece of work and will be eagerly sought after - he's so darned pretty - he's going to make some inmate a very good wife....

Practicing.

“Bob, please take your hand off my a**.”

22 posted on 05/20/2009 11:06:57 AM PDT by Liz (Everything Obama says comes with an expiration date.)
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