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December 13, 2009

An unhappy Madoff anniversary

http://www.jewishjournal.com/blog/item/an_unhappy_madoff_anniversary_20091212/

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Before Jews could light the menorah Friday night, they celebrated a much sadder anniversary. It had been one year since Bernard Madoff’s fantasy financial league collapsed and with it a good deal of Jewish wealth that had been mistakingly invested with the great swindler. Many folks didn’t know there money was with Madoff; others did but had no reason to worry.

Where are we now?

Well, Madoff is serving the first of 150 years in prison and Jewish groups are still struggling to recover from the hit. The AP brings us up to speed, one year later:

With the global financial crisis in full bloom, 2009 was already shaping up to be a grim year for charities, but few have had such rough going as the philanthropies that learned a year ago Friday that some or all of their finances had been wiped out in the Madoff scandal.

Some, like the $1 billion Picower Foundation, the $240 million Betty and Norman F. Levy Foundation and the $198 million Chais Family Foundation, lost everything and shuttered within days.

Others survived. They have spent the year cutting staff, curtailing grants and hoping, often in vain, that new donors would step in and help replenish what they lost.

“It has been a very difficult year,” said Richard Gordon, president of the American Jewish Congress, which saw a $21 million trust left to it by philanthropists Lillian and Martin Steinberg vanish in the fraud. “Like anything else, you go through anger and outrage, and over the year, I think you work through some of the issues. But there is a tremendous sense of loss of what you could have done.”

The damage caused to charities, especially Jewish nonprofits and those that aided Israel, is still being assessed.

Scores of foundations and charitable trusts appear to have lost enough money because of Madoff, who was active in the Jewish community and knew the heads of many of the organizations that invested with him, to hinder or cripple operations. Others lost nothing but suffered anyway.

Jewish Communities of MetroWest New Jersey, a charity that didn’t have a dime invested with Madoff, still had to slash operations after more than a dozen of its major donors, who had been giving $600,000 a year, were wiped out in the fraud.

Its CEO, Max Kleinman, said it had to lay off 12 people, furlough staff and cut executive salaries.

Still, the work continued.

The Elie Wiesel Foundation for Humanity, founded by the writer and Holocaust survivor, said in a posting on its Web site that it still managed to have “a productive year,” despite losing almost all of what it thought was a $15.2 million endowment.

“Thanks to generosity from around the country and world, with donations from $5 and up, we are pleased to let you know that we are able to honor all of our commitments and continue all of our projects,” the message said.

Read the rest here.

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