NEW YORK — If Ruth Madoff hopes to hold onto her fancy apartment, her millions in cash and her jetsetting lifestyle while her husband is in prison, experts have some advice for her: Get ready for an inquisition.
Attorneys and investment specialists say Madoff will have a difficult time proving her assertion that up to $69 million of the couple's wealth was unrelated to her husband's Ponzi scheme.
"It's going to be very hard for her to show that anything is untainted," said Alton Abramowitz, national vice president of the American Academy of Matrimonial Lawyers.
Some angry investors suspect their money ended up in Ruth Madoff's hands. At the court hearing where her husband pleaded guilty Thursday, the mere mention of her name drew jeers and laughter.
The couple met at their Queens high school and married in 1959, the year after she graduated. She was blonde and pert and devoted, and some investors have said their long marriage lent an air of stability to Madoff and his fund.
But even if she is never charged with a crime, Ruth Madoff's wealth will be closely reviewed by federal prosecutors and civil lawyers.
Investigators will want to see personal bank statements, credit card receipts, tax returns and canceled checks, as well as her business records.
"The process gives us the right to look at all of it to try to prove that Mrs. Madoff did not earn this money on her own," said Jeffrey Sonn, a securities specialist in Fort Lauderdale, Fla., representing dozens of Madoff claimants. "It's intrusive, sure, but that's the procedure."
What those credit-card receipts will show is a life apparently unbound by care, with homes in Palm Beach, Fla., the south of France and the tip of Long Island, besides the $7 million penthouse in midtown Manhattan. There was also travel by private jet and yacht.
At Thursday's court hearing, loud laughter erupted among some of the more than 100 spectators when Bernard Madoff's defense lawyer described the conditions of his client's house arrest and how Madoff had, "at his wife's own expense," paid for private security at their Manhattan home.
There was more snickering when the attorney mentioned that, at the initial bail hearing, he had accounted for Madoff's vast assets including his wife's "small residence in France."
As a young couple, the Madoffs set up a financial-services firm in 1960 on a few thousand dollars Madoff had saved from lifeguarding and installing sprinklers.
Ruth Madoff worked beside her husband at the start and reportedly still had an office near his when the end came last December.
Over the years, Bernard Madoff's financial acumen became legendary, and friends and acquaintances begged him to take their money. The couple also raised two boys — Mark, now 44, and Andrew, 42 — who are both now talking to investigators.
Ruth Madoff, now 67, became co-trustee of the family foundation, earned a master's degree in nutrition and helped compile a cookbook, "The Great Chefs of America Cook Kosher," still available on Amazon.com.
Now the couple's life of privilege is endangered by both the criminal and civil cases.
First, the federal judge overseeing Bernard Madoff's case is likely to rule that he must forfeit some large sum, to be determined by an ongoing investigation that's looking at all family members.
Madoff has already given up the rights to his investment business, his company's prized artwork and some entertainment tickets, and about a dozen checks have already gone out to victims of the Ponzi scheme.
But those checks from the Securities Investor Protection Corp. are limited to $500,000, and that's not likely to stanch the filing of civil lawsuits, including class actions, which will then delve into the Madoff assets.
Ruth Madoff's attorney, Peter Chavkin, declined to comment Thursday. But his client will probably try to prove that her assets came from her own earnings or her own money, and that there was no mixing with funds tainted by her husband's crime.
She may already be preparing that defense, with the help of her husband.
In a lengthy statement Thursday, he told the judge that some parts of his business were legitimate and successful — a possible move to show that some of the family's assets are separate from the Ponzi scheme.
"He's trying to save the rest of his family," said investor Judith Welling. "We need to find out who else was involved, and we need, obviously, to freeze the assets of all those people involved to help the victims."
Madoff and his lawyers are also claiming that the Manhattan apartment and an additional $62 million in bonds and cash can be kept from investors because they are in Ruth Madoff's name and unrelated to the fraud.
"We are all skeptical of that claim because how did she earn $70 million?" Sonn asked. "She's going to have to show a trail to show it came from somewhere other than Madoff securities."
Andrew DeNatale, a specialist in the law governing creditor-debtor rights, said, "Just because something's in her name doesn't automatically protect her. The analysis would be, 'When was it put in her name? How did it get in her name?' Any transfers into her own name at the present time or recently would be investigated as fraudulent."
Criminal and civil auditors are also interested in the $15.5 million Ruth Madoff withdrew from an account in Massachusetts last year, including $10 million on the day before her husband surrendered.
Massachusetts Secretary of State William Galvin said last month that the withdrawals raise questions about whether there was a broader conspiracy behind Bernard Madoff's actions. Madoff has claimed he acted alone.
Madoff made no deal with prosecutors, so he is not obligated to disclose what, if anything, Ruth Madoff knew about the fraud.
Criminal defense attorney Gerald Lefcourt said Ruth Madoff could argue that even if some asset is tainted, she should be able to keep it if she knew nothing of the wrongdoing.
That's a tough sell with investors.
"Does anybody think she didn't know?" Sonn asked. "She worked with him, she lived with him, they traveled together, they were inseparable for 50 years."
Lawyers said they have occasionally seen couples consider divorcing to protect one spouse's assets when the other is convicted of fraud.
"But courts are alert to phonied-up divorces," said family law specialist Henry Bergen. "Filing for divorce now would not help the Madoffs. Even the lawyers would get in trouble."
Most experts believe the investigation into the Madoff assets will end with some kind of settlement, perhaps leaving Ruth Madoff with enough money to be secure but without extravagances like the penthouse. Florida's homestead law may protect the mansion there, as it protected O.J. Simpson's.
"The only way she is left in poverty is if she fights this to the finish and loses," said attorney Robert Zobrish. "Otherwise some resolution will be worked out which allows her to keep something so she can live some sort of life."
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