Two weeks after Norma Hill and her husband invested their life savings with Bernard Madoff, she came to the then-trusted money manager with news her spouse suddenly died.
Madoff “put his arm around my shoulder and assured me my money was safe and I should not worry,” she wrote.
In the end, the widow lost everything.
U.S. District Judge Denny Chin cited Hill’s letter as one of the most stirring examples of an “extraordinarily evil” fraud, one worthy of a staggering sentence for Madoff: 150 years behind bars.
The sentence went far beyond the 12 years suggested by Madoff’s lawyers and virtually guaranteed that, at age 71, the financier-turned-felon would die while imprisoned. Chin said the term was meant to symbolically fit the crime — a multibillion-dollar fraud that’s been called the largest in history.
“Here, the message must be sent that Mr. Madoff’s crimes were extraordinarily evil and that this kind of irresponsible manipulation of the system is not merely a bloodless financial crime that takes place just on paper, but it is instead ... one that takes a staggering human toll,” Chin said.
The sentence capped a 90-minute hearing in an ornate courtroom in Manhattan that turned into a tense showdown between a group of angry, tearful victims and Madoff, who sat silently at a defense table before apologizing with a mechanical calm.
“I will turn and face you,” he said. “I’m sorry. I know that doesn’t help you.”
More drama followed the sentencing when Madoff’s wife Ruth, often a target of victims’ scorn since her husband’s arrest, broke her silence by issuing a statement through her lawyer. She said she, too, had been misled.
“I am embarrassed and ashamed,” she said. “Like everyone else, I feel betrayed and confused.”
It was unclear where Madoff, who was returned to a downtown jail, will end up spending time. Chin said he would recommend a facility in the Northeast, but explained that it was up to federal prison officials determine an exact location and level of security.
The sentencing concluded a stunning fall from grace for Madoff. Clients of the former Nasdaq chairman — from Florida retirees to celebrities such as Steven Spielberg, actor Kevin Bacon and Hall of Fame pitcher Sandy Koufax — for decades flocked to him seeking investment returns that defied market fluctuations.
But late last year, Madoff made a dramatic confession: Authorities say he pulled his sons aside and told them of a massive Ponzi scheme.
Madoff pleaded guilty in March to securities fraud and other charges, saying he was “deeply sorry and ashamed.” He insisted that he acted alone, describing a separate wholesale stock-trading firm run by his sons and brother as honest and legitimate.
Aside from an accountant accused of cooking Madoff’s books, no one else has been criminally charged. But the family, including his wife, and brokerage firms who recruited investors have come under intense scrutiny by the FBI, regulators and a court-appointed trustee overseeing the liquidation of Madoff’s assets.
The trustee and prosecutors have sought to go after assets to compensate thousands of victims who have filed claims against Madoff. How much is available to pay them remains unknown, though it’s expected to be only a fraction of the astronomical losses associated with the fraud.
The $171 billion forfeiture figure used by prosecutors merely mirrors the amount they estimate that, over decades, flowed into and out of the principal account to perpetrate the Ponzi scheme. The statements sent to investors showing their accounts were worth as much as $65 billion were fiction.
The investigation has found that in reality, Madoff never made any investments, instead using the money from new investors to pay returns to existing clients — and to finance a lavish lifestyle for his family. The actual loss so far has been put at $13.2 billion. But the judge said that was a conservative estimate and noted that even Madoff told his sons in December it was a $50 billion fraud.
Chin announced the sentence with Madoff standing at the defense table, wearing a dark suit, white shirt and a tie, and looking thinner than his last court appearance in March, when he was first jailed. He gave no noticeable reaction when the sentence was announced.
He also showed no emotion though he looked down earlier in the hearing as he listened to nine victims spend nearly an hour labeling him a “monster,” “a true beast” and an “evil low-life.”
“Life has been a living hell. It feels like the nightmare we can’t wake from,” said Carla Hirshhorn.
“He stole from the rich. He stole from the poor. He stole from the in between. He had no values,” said Tom Fitzmaurice. “He cheated his victims out of their money so he and his wife Ruth could live a life of luxury beyond belief.”
Sheryl Weinstein, a certified accountant, said Madoff was effective because he seemed normal.
“But underneath the facade is a true beast,” she said. “He should not be given the opportunity to blend so seamlessly into our society again.”
When asked by the judge whether he had anything to say, Madoff slowly stood, leaned forward on the defense table and spoke in a monotone for about 10 minutes. At various times, he referred to his historic fraud as a “problem,” “an error of judgment” and “a tragic mistake.”
He claimed he and his wife were tormented, saying she “cries herself to sleep every night, knowing all the pain and suffering I have caused,” he said. “That’s something I live with, as well.”
The jailed Madoff had already taken a severe financial hit: Last week, a judge issued a preliminary $171 billion forfeiture order stripping Madoff of all his personal property, including real estate, investments, and $80 million in assets his wife Ruth had claimed were hers. The order left her with $2.5 million.
The terms require the Madoffs to sell a $7 million Manhattan apartment where Ruth Madoff still lives. An $11 million estate in Palm Beach, Fla., a $4 million home in Montauk and a $2.2 million boat will be put on the market as well.