NEW YORK - From a Jewish youth charity in Boston to major banks as far afield as Zurich, investors who say they were duped in one of Wall Street's biggest Ponzi schemes are streaming forward.
Around the world, those who sunk cash into veteran Wall Street money-manager Bernard Madoff's investment pool spent the weekend calculating how much exposure they might have. Madoff, 70, a former chairman of the Nasdaq Stock Market, was arrested Thursday in what prosecutors say was a $50 billion scheme to defraud investors.
One thing was clear in the fallout from his arrest: The alleged victims range from the super rich, Like former Philadelphia Eagles owner Norman Braman and New Jersey Sen. Frank Lautenberg, to pensioners and powerful financial institutions, to local charities.
"There were a lot of very sophisticated people who were duped, and that happens a great deal when you've had somebody decide to be unscrupulous," said Harvey Pitt, a former chairman of the Securities and Exchange Commission, a regulator in charge of monitoring investment funds like the one Madoff operated.
"It isn't just the big investors," he said. "There's a lot of charitable and foundation money involved in this, which is the real tragedy."
fund. The assets of Bernard L. Madoff Investment Securities LLC were frozen Friday in a deal with federal regulators and a receiver was appointed to manage the firm's financial affairs.
One of the largest financial scams to hit Wall Street has investors wondering if they'll ever get their money back.
In Boston, the Robert I. Lappin Charitable Foundation, a charity that financed trips for Jewish youth to Israel, said on its Web site yesterday that the money for its operations was invested with Madoff.
"The money needed to fund the programs of the Lappin Foundation is gone," it said. "The foundation staff has been terminated today."
Lautenberg, one of the wealthiest members of the Senate, entrusted his family's charitable foundation to Madoff. Lautenberg's attorney, Michael Griffinger, said they weren't yet sure the extent of the foundation's losses, but that the bulk of its investments had been handled by Madoff.
Lautenberg's foundation handed out more than $765,000 to at least 100 recipients in 2006, according to the most recent listing on Guidestar, which tracks charitable organization filings.
The foundation helps support a variety of religious, educational, civic and arts organizations in New Jersey and elsewhere.
Reports from Florida to Minnesota included profiles of ordinary investors who gave Madoff their money. Some had been friends with him for decades, others were able to invest because they were a friend of a friend. They told stories of losing everything from $40,000 to an entire nest egg worth well over $1 million.
They join a list of more powerful investors that have come forward, all worried about the extent of their losses. The roster of names includes Braman, New York Mets owner Fred Wilpon and J. Ezra Merkin, the chairman of GMAC Financial Services, among others.
Beyond U.S. hedge funds, more corporate names disclosed exposure to Madoff. Late yesterday, some of Europe's biggest banks acknowledged they, too, were exposed to Madoff's investment fund.
Left with billions of dollars in exposure, according to media reports, are Spain's Grupo Santander SA, Europe's second-largest banking consortium, which is in the process of buying Philadelphia's Sovereign Bancorp, and France's BNP Paribas. The banks could not immediately be reached for comment. *