Ruth Madoff's Millions
CBS News
Transcript
A plea deal in the Bernard Maidoff scandal could come as early as this week, but many doubt that he could have pulled off his grand Ponzi scheme alone. CBS News correspondent Randall Kingston has more. When Bernard Maid off goes to court on Thursday, some of his built investors will be there too to learn what kind of punishment the disgraced financier will receive for running a multi-billion dollar Ponzi scheme. 40 years of um trying to do everything right and having nothing. Investors want prosecutors to spell out how the scheme worked, how much money they will get back, and who else was involved. How likely is it that Bernard Maidoff will be the only person charged? Oh, I think that that is unlikely. Attorney Brad Friedman, who represents more than a 100 maid off clients, has many questions. Who helped Maid Off run the fraud? Where did the money go? If those questions are not answered, then the government should proceed in every way possible to put him in prison for as long as possible and to go after absolutely everyone that they can go after. The sons, the brother, the wife, Ruth. Ruth Maid off is claiming to own independently nearly $70 million in real estate, municipal bonds, and bank deposits. What do you think about the effort by Rof Maidoff's attorney to segregate her assets from Bernard Maidoff's assets? That's really ridiculous. Uh, and I don't think it's going to succeed. The only thing she's ever done to earn money for herself is I think I heard that she wrote a cookbook. Maid off's expected plea deal may reveal more about how he was cooking the books in a recipe for financial disaster. Randall Kingston, CBS News, New York. Joining us now is CBS News legal analyst Lisa Bloom. Good morning, Lisa. So, the news this morning is that Ruth Maidoff is getting her own attorney. So, up to now, she's been sharing her attorney with her husband. A lot of lawyers say that's an indication that she could be in legal trouble herself. Well, it could be. And look, investors want to go after the pot of gold, and the only money left standing is the money in Ruth's name. So, it only makes sense. It's only prudent for her to get her own attorney to protect her potentially criminally and civily. Okay. The money that she has, $70 million worth, is a $7 million penthouse here in New York City.4 $45 million that she has in municipal bonds, not in his fund, interestingly, and 17 million in the bank. What determines whether she gets to keep that? Well, the question is, did he fraudulently convey that money to her? It was money that should have belonged to the investors, essentially stolen from the investors, and he gave it to his wife. It's the oldest trick in the book to try to hide assets in your spouse's name. On the civil side, it will not matter if that money was fraudulently conveyed to her. She has to disgorgge the assets. She has to turn it over to the investors on the civil case. Criminally, it matters a lot whether she knew. She can't be criminally prosecuted unless she had knowledge she was involved in the fraud. Okay. So, what determines whether he fraudulently gave it to her? If she if he made any of that money, then he fraudulently made it to her. Probably. Yeah. Probably at this point, it's hard to say otherwise. Look, she wrote a cookbook. Maybe she made some of that money on her own from the cookbook or maybe she made it from his cooked product. Cooked books. Right. Exactly. That's what the courts will be looking at. Okay. criminally, how do you prove whether or not she knew? That's going to be tough. Well, yeah, it's tough, but you know, that's true in every criminal case. You have to get inside the mind of the criminal defendant. So, we'll look at what statements she may have made to other people, what her level of involvement was in the company. She has said that she was involved in the company. She's called herself a director. How much did she look at the books? I think that's going to be the key question. She was with him for 50 years. A lot of people say, "How can you live with someone for 50 years and not have an inkling?" And they were very close. They dined together, just the two of them, a couple times a week in a little booth in the corner of a back in the back of a prominent Manhattan restaurant. They were very intimate, this couple. So, it is hard to imagine that she didn't know. But look, this is a crime of accounting. This is a crime that happens on the books. It is possible that he simply uh did this Ponzi scheme, cooked the books, and she wasn't aware of it. So, she is innocent until proven guilty. We have to remember that. A lot of wives, especially from from that generation, don't necessarily get involved. Exactly. She was living the good life. She did help people get into the fund, but she could have simply been ignorant of what was going on. All right, more to come, I'm sure. Thanks, Lisa. Thanks, Mag. Good to see you. [Music]
Bank reform 'key to recovery'
CNN
Transcript
Until we stabilize the financial system, a sustainable economic recovery will remain out of reach. In particular, the continued viability of systemically important financial institutions is vital to that effort. In that regard, the Federal Reserve, other federal regulators, and the Treasury Department have stated that they will take any necessary and appropriate steps to ensure that our banking institutions have the capital and liquidity necessary to function well even in a severe economic downturn. Moreover, we have reiterated the U.S. government's determination to ensure that systemically important financial institutions continue to be able to meet their commitments. At the same time that we are addressing such immediate challenges, it is not too soon for policymakers to begin thinking about the future. We must have a strategy that regulates the financial system as a whole in a holistic way, not just at its individual components. In particular, strong and effective regulation and supervision of banking institutions, although necessary for reducing systemic risk, are not sufficient by themselves to achieve this aim. In addition, the Federal Reserve's commitment to the financial system is to ensure that the financial system is a safe and secure place for all to live and work.