Legal News

Ruth the Truth? Feds Find No Evidence on Bernie?s Wife

By Ashby Jones

My husband was the one we (and I include myself) respected and trusted with our lives and our livelihoods, often for many, many years, and who was respected in the securities industry as well. Then there is the other man who stunned us all with his confession and is responsible for this terrible situation in which so many now find themselves.

Lives have been upended and futures have been taken away. All those touched by this fraud feel betrayed; disbelieving the nightmare they woke to. I am embarrassed and ashamed. Like everyone else, I feel betrayed and confused. The man who committed this horrible fraud is not the man whom I have known for all these years. — Ruth Madoff, in a June 29, 2009 statement

Until now, it’s been hard to know what to think of Ruth Madoff; many have chosen, it seems, to view her as a blank screen, projecting whatever larger feelings they may have had about her husband upon her. Some find her a victim, others seem to feel she’s making out like a bandit, still others feel as if she must have known about Bernie’s scheme.

But for now, it seems that, unless something changes, she’ll likely remain a free woman. Federal investigators have concluded there is no physical evidence that she actively participated or concealed her husband's fraud, according two people familiar with the matter. Click here for the WSJ story.

Without new revelations or incriminating testimony from witnesses, the 68-year-old Mrs. Madoff won’t be criminally charged, these people said.

Peter Chavkin, Mrs. Madoff's lawyer, declined to comment.

On Friday Ruth, who has been vilified in the tabloids and fended off paparazzi, agreed to give up her potential claim to more than $80 million worth of assets, keeping just $2.5 million in cash in an agreement reached with federal prosecutors. The agreement didn't preclude future criminal charges or lawsuits by the Securities and Exchange Commission or attorney Irving Picard, the trustee of the defunct Madoff firm who is recovering assets for investors.

LBers, count us among the group that — yes — feels sympathy for Ruth, assuming that she truly didn’t know anything about Bernie’s shenanigans. Yes, she gets to keep a tidy sum of money, but her life as she knew it is over, her husband is gone, and her name will, until she dies, be linked to the mastermind of the largest financial fraud in history. So, for us, it’s sympathy. (Though we freely acknowledge that the sympathy might not be flowin’ so readily had we lost a big chunk of change at Bernie’s hands.)

We’re curious, readers: Where do you come down on Ruth?

Full post as published by Law Blog - WSJ.com on July 01, 2009 (boomark / email).