For Madoff Victims, Scars Remain 10 Years Later Two of Bernie Madoff's victims share how their lives were affected by the Ponzi scheme that imploded ten years ago. They recovered much of what they invested, but were still harmed by the scam.

For Madoff Victims, Scars Remain 10 Years Later

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Ten years ago, this country was reeling from the worst financial crisis in decades, and in the middle of it all came shocking news. Bernie Madoff, a pillar of Wall Street, was arrested for orchestrating a multibillion-dollar Ponzi scheme.


UNIDENTIFIED REPORTER: The news, spread fast and quickly, engendered panic amongst investors who gathered at the offices of their alleged swindler.

GREENE: Hundreds of people were told the money they'd invested with Madoff's firm was probably gone. They included rich and famous people but also those of more modest means. Now, many of those investors have recovered most of the money they lost. But as NPR's Jim Zarroli reports, they're still living with the consequences of Madoff's fraud.

JIM ZARROLI, BYLINE: To his investors, Bernie Madoff was a Wall Street genius, a man who racked up big returns year after year, no matter how the economy was doing. But Madoff lived with a terrible secret. And in 2008, with the economy crashing, he was forced to admit that his investments were a fiction. In tapes published by New York Magazine later, Madoff talked about breaking the news to his family.


BERNIE MADOFF: Everybody was just like stunned. You know, I was crying. And I said, look; you know, I just - you know, I don't know what else to tell you.

ZARROLI: As news of Madoff's Ponzi scheme broke, thousands of investors, including many charities, learned they didn't have the money they thought they had. They included Steve Heimoff, a writer and critic whose retirement fund was wiped out.

STEVE HEIMOFF: I had an email from a cousin of mine, and I read through the body of her email, and she explained that it was all gone - every penny.

ZARROLI: Before then, Heimoff had never heard of Madoff, but an investment fund used by him and his family had been feeding money to Madoff's firm. Now that money had vanished. And at age 62, Heimoff was forced to refinance his condo and severely cut back on spending.

HEIMOFF: I just stopped going to restaurants. I stopped buying clothing. I stopped going on vacations. I stopped going to movies.

ZARROLI: The toll his losses would take on Heimoff was considerable.

HEIMOFF: I came very close to suicide for at least a year. It's been very emotionally exhausting. There's an element of post-traumatic stress syndrome.

ZARROLI: In the years since then, Madoff, who's now 80, pleaded guilty and was sent to federal prison - so were six of the people who worked at the firm, including Madoff's brother, Peter. One of Madoff's sons hung himself in his New York apartment. Meanwhile, the court appointed a trustee to try to recover what he could from the wreckage of Madoff's finances. That trustee is Irving Picard. He spoke to NPR's Weekend Edition on Sunday about how he worked.


IRVING PICARD: A lot of hard work, some good lawyers working with us and forensic accountants and investigators, and we developed the case from the ground up.

ZARROLI: The fund has so far recovered about $13 billion, partly by selling off Madoff's houses and his 55-foot yacht named Bull. The money will go to Madoff victims. Surprisingly, many of them will get back most of the funds they invested with Madoff, but they're only receiving money they actually put into the fund. Those great returns they thought they were getting, the money in those monthly statements Madoff sent out, virtually all of that is gone. Michael De Vita estimates he'll get back about 60 percent of what he put into Madoff's fund.

MICHAEL DE VITA: I retired in August of 2018 - eight years later than I expected - on less than a third of what I expected to retire on.

ZARROLI: Nor will investors get back much of the taxes they paid over the years on those returns. De Vita has become something of an investor advocate since then and teaches a college course on Madoff. He says a lot of people weren't very sympathetic to Madoff victims.

DE VITA: There was a lot of feelings back at that time that people who were invested with Madoff, quote, "got what they deserved" - that the returns were too good to be true, and therefore you took advantage of the system, and you know what? Ha ha, we got you.

ZARROLI: But De Vita says a lot of Madoff victims weren't sophisticated or rich. They were just average people like himself, people who naively trusted Madoff with their retirement money and have paid a terrible price. Jim Zarroli, NPR News, New York.

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