Ruth Madoff and I have something in common. No, Mr. PunditMom hasn’t been running his own multi-billion dollar Ponzi scheme and I can guarantee you we don’t have a chateau in France or a getaway home in Florida. But I think Ruth and I are both going to be getting back to clipping coupons, scanning the sale fliers and spending more time at the 99 cent store in coming months, but for slightly different reasons.
Now that her husband Bernie Madoff is in jail waiting to find out how many more years he’ll spend there (not the minimum security, country club kind, I hope), the focus is now on how much money the feds will ever be able to get back for the victims of his massive fraud. The most logical place to start is with the obvious assets — those that Bernie claims should be left in the hands of his wife, Ruth.
There’s been a lot of speculation about whether Ruth Madoff did or didn’t know what a big crook her husband was. And I’m sure the SEC and criminal prosecutors are trying to figure out if she had enough of a role in his scheme that she ought to be modeling the classy orange jumpsuit, as well.
But that question almost doesn’t matter for investors at this point. The bigger concern is whether the $70 million in cash and assets she’s sitting on is legitimately hers or whether there was a fraudulent transfer of assets from Bernie. (I just love when I still get to talk all SEC legal like!)
Ruth was employed by Bernie’s company, so she probably got some salary, though odds are that was from stolen money, and she did write a cookbook a few years back (or did she?). But would that give her a nest egg big enough to have four homes, millions in jewels and a bank account hefty enough to do some serious damage at Barney’s for years to come?
The only question that’s really important now is whether the things she claims are hers and hers alone were purchased with money from the fraud, making them fair game to be disgorged (yeah, I’m going all SEC again) to give at least a little back to Madoff’s victims. Ruth did look a tad guilty when she was caught sending some of that jewelry and a few expensive watches out of the country right before her hubby was arrested. Can you say trying to hide the assets long enough to sell them and hide the cash?
So it’s pretty likely she’s going to need some tips to get along in this new economy. My guess is that she hasn’t had to think about economizing for a couple of decades, but the time for her to get in that mode is approaching fast.
I’ve been thinking it’s time for me to go back to my economizing ways — I’m a coupon clipper and dollar store shopper from way back, but I had let those more frugal ways slip in recent years as I was feeling more flush. Now, with the state of today’s economy, I have to flush those ways and go back to what I learned at my mother’s knee. I’m happy to share a few of those tips with Ruth Madoff if she wants because unless she’s got a stash in a cookie jar, she’s going to need a little pin money. Soon.