Ruth Madoff: 'What's a Ponzi scheme?'
Ruth Madoff spoke to '60 Minutes' about her husband, Bernard Madoff, who was convicted of one of the biggest financial frauds in history. Ruth Madoff, and son Andrew, said that they didn't know about the $65 billion Ponzi scheme.
(AP Photo/60 Minutes)
The wife and son of financial swindler Bernard Madoff said in their first broadcast interview Sunday that they knew nothing of his estimated $65 billion Ponzi scheme, but feel shame for his "unforgiveable" crime.
Madoff, 73, is serving a 150-year prison sentence after confessing to running a decades-long scheme that bilked investors out of billions, considered the biggest financial fraud in history.
Defrauded Madoff investors have long viewed the convicted swindler's sons, wife and other family member suspiciously, arguing it is impossible that they did not know about his lies. No family members have been criminally charged.
Madoff's younger son Andrew told the CBS program "60 Minutes" that the family was shocked when his sobbing father confessed his crime to them in December 2008. He said his mother Ruth's first question was "What's a Ponzi scheme?"
"She didn't even understand that. I think it was me who answered and said that "It means that it's all fake,'" Andrew Madoff said. "(Bernard Madoff) followed that up and said 'Yes, I've been lying to all of you - all of these years. I've been lying to everybody. I've been lying to myself.'"
Mark and Andrew Madoff -- who worked at their father's firm -- turned him into authorities and he was arrested on December 11, 2008.
Madoff has insisted he acted alone in running the Ponzi scheme, a fraud in which early investors are paid with money from new ones. Such schemes often collapse when there are too few new investors or too many investors try to cash out at once.
Since he pleaded guilty in March 2009, seven other people have been arrested in the case, including several of his long-time employees and an outside accountant.
Mark Madoff, 46, hanged himself in his New York apartment last year on the second anniversary of his father's December 11 arrest. Ruth Madoff said that the couple had also tried to kill themselves by taking pills on Christmas Eve in 2008.
"I can't explain it, I mean I trusted him," Ruth Madoff said when asked how she could not have known of her husband's crime. "Why would it ever occur to me that it wasn't legal?"
"There was nothing that would ever make me suspect anything," she said.
Andrew Madoff said his father's investment advisory business, the Ponzi scheme, was "a completely separate business" to the trading business where he and his brother worked.
"We were executing hundreds of thousands of transactions a day. And that kept all of us incredibly busy. And it just -- it just didn't occur to me that he could be involved in any kind of criminal activity," he said.
Andrew Madoff said one of the hardest things for him to come to terms with was the feeling that he and his brother were used by his father, who shielded his Ponzi scheme with their legitimate trading business.
"It's unforgiveable," he said. "No father should do that to their sons."
Ruth Madoff and her sons barely spoke in the two years after his father's arrest because, Andrew Madoff said, he and his brother could not understand her decision to stay by their father's side.
"I never though of leaving," Ruth Madoff said. "I didn't know what else to do but stay there."
"I think he got stuck, that's what he said. And he didn't have the courage to face things when they might have been able to be faced on a much smaller scale," she said.
After her son Mark committed suicide, she cut off contact with her husband and now lives in a three-room apartment in South Florida.
When asked why she hadn't filed for divorce, Ruth Madoff said: "It doesn't matter to me -- he's going to die in prison."
The Madoff scandal shook investors around the world and sparked criticism of market regulators for failing to catch him despite warnings and tips over many years. A court-appointed trustee is now trying to recover the money for investors defrauded by Madoff.
"What he did to me, to my brother, and to my family is unforgiveable," Andrew Madoff said. "What he did to thousands of other people, destroyed their lives -- I'll never understand it. And I'll never forgive him for it."
( Editing by Eric Walsh)