Ruth Madoffs knew about the fraud

More than 100 former clients who lost money in the $65bn Ponzi scheme outline the devastation wrecked on their lives

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Pic by AP

Here's the people who've ostracized Madoff and the things that've become out of reach to her: a florist in Amagansett, her kids (who have started referring to their parents as "Ruth" and "Bernie"), the gym she can no longer work out at, the Italian restaurant down the street they owe a tab to, the other Italian restaurant she used to frequent but can't (because Bernie swindled too many regulars there), etc. She paints Ruth as having a lonely, solitary existence, one in which the walls are closing in on her:

Even in her exile, Mrs. Madoff's world is rapidly getting smaller. Victims of the scheme are pushing the bankruptcy trustee and federal prosecutors to sell anything they can, including the couple's penthouse, which was used to help secure Mr. Madoff's bail; it could be seized after Mr. Madoff's sentencing, which is scheduled for June 29.U.S. marshals seizedBernard Madoff $7 million Manhattan penthouse apartment following a federal judge’s order that the Upper East Side residence be forfeited by the convicted con man July 3rd 2009..

And there's a vague element of culpability placed on Ruth in the article, but clearly: not enough. Anything that paints Ruth as lonely and sad in any regard in utterly insane. Her husband took thousands of organizations, non-profits, and families, and absolutely hosed them, and she was right there by his side, knowingly doing his bidding. So when the Times counts off all the different concessions Ruth has had to make over the last few months, even down to what she's wearing...

Before the scandal, Mrs. Madoff radiated an understated sense of taste. She favored slim black pants, fine-gauge white cotton crew necks, Susan Bennis Warren Edwards crocodile-leather flats and classic gold jewelry, according to a friend of the family who saw her regularly at gatherings. Now Mrs. Madoff spends her days largely confined to the two-story four-bedroom penthouse on 64th Street near Lexington Avenue, dressed in jeans and an Oxford-style shirt, according to someone who is in touch with her regularly.

...it looks ridiculous, and totally oblivious. And not that we're the last word on sensitivity around here, but come on: the woman invoked marital privilege, she's going to get off clear and free for a crime she was fairly implicit in.

Source ABC News: Ruth has told members of her family that she feels lonely and shunned since her husband admitted to the fraud. But the victims of the scam have little sympathy.

"Why would you have sympathy for his wife in any of these circumstances?" asked Jon Landers, an attorney representing some of Madoff's victims. "She was one of the largest beneficiaries of the fraud. She enjoyed a very rich lifestyle that practically everyone would love to emulate and it was paid for by someone else,"

Documents recently released illustrate a lavish lifestyle that was funded by investors' money. American Express corporate platinum card statements show the Madoffs spent freely around the world.

There was a $1,900 dinner at a New York City restaurant.

Ruth Madoff spent nearly $3,800 on a Paris shopping spree.

Their sons, Andrew and Mark, spent more than $13,000 on a ski trip in Jackson Hole, WY.

It becomes so easy and if you go on year after year after year and you're not caught then I'll go to Neiman Marcus and I'll pay for the yacht and I'll fly to Europe and I'll go to the Riviera because it becomes normal even though it's really criminal activity," said Brad Garrett, a former FBI agent and an ABC News consultant.

The documents filed in bankruptcy court by the trustee overseeing the liquidation show Madoff used investor money to reward key employees.

Madoff sent $2.2 million so that one staffer, now under criminal investigation, could buy a New Jersey beach house.

Frank DiPascali, Madoff's right hand man, was paid nearly $3 million a year. DiPascali's boat captain was also on the Madoff payroll, according to the documents.

Authorities have seized $2.6m in jewelry from Ruth. Pics by AP.

Last month, she agreed to give up her potential claim to more than $80 million of assets, keeping just $2.5 million in cash in an agreement reached with federal prosecutors. Mrs. Madoff also agreed to sell her New York properties in Manhattan and Long Island as well as in Palm Beach, Fla., in order to preserve the value of the assets for investors.

The court-appointed official in charge of recovering money for Bernard Madoff's investors is suing Ruth, for at least $44.8 million, claiming she lived a "life of splendor" on the gains from the fraud perpetrated by her husband. Irving Picard, the court-appointed trustee, alleged that 68-year-old Ruth Madoff "knew or should have known" that vast sums of money she received from her husband's investment firm, Bernard L. Madoff Investment Securities LLC, rightly belonged to the firm and to her husband's customers."For decades, Mrs. Madoff lived a life of splendor using the money of BLMIS's customers," Mr. Picard said in a lawsuit filed in U.S. Bankruptcy Court in Manhattan. "Regardless of whether or not Mrs. Madoff knew of the fraud her husband perpetrated at BLMIS ... she received tens of millions of dollars from BLMIS for which BLMIS received no corresponding benefit or value and to which Mrs. Madoff had no good-faith basis to believe she was entitled."Mr. Picard has now filed about a dozen lawsuits against hedge funds and individuals seeking to recover billions dollars in funds withdrawn from Mr. Madoff's firm to distribute them to victims of the Ponzi scheme.