« ANNOUNCEMENT: Live Chat With 'CauseWired' Author Tom Watson | Main | ANNOUNCEMENT: Grants That Make a Difference »

Fallout From Madoff Scandal Spreads

December 15, 2008

BernardmadoffOver the weekend, we learned that at least two foundations, the Robert I. Lappin Foundation and the Chais Family Foundation, had lost millions in Bernie Madoff's alleged Ponzi scheme and were closing their doors, effective immediately.

The latest victim of the scam is the New York City-based JEHT Foundation (an acronym for Justice, Equality, Human dignity and Tolerance), which earlier today announced that it was halting all grantmaking effective immediately and would shut its doors at the end of January. The foundation has posted a statement on its Web site that reads in part:

The JEHT Foundation Board deeply regrets that the important work that the Foundation has undertaken over the years is ending so abruptly. The issues the Foundation addressed received very limited philanthropic support and the loss of the foundation's funding and leadership will cause significant pain and disruption of the work for many dedicated people and organizations. The Foundation's programs have met with significant success in recent years -- promoting change in these critical areas in partnership with government and the nonprofit sector. Hopefully others will look closely at this work and consider supporting it going forward....

Inquiries should be directed to the foundation, care of its president, Robert Crane, rcrane@jehtfoundation.org.

-- Mitch Nauffts

Comments

Feed You can follow this conversation by subscribing to the comment feed for this post.

The list will continue to grow.

Other sources cite some more foundations as damaged, in some cases severely:

1) Steven Spielberg's Wunderkinder Foundation is said to have taken losses

2)The Carl and Ruth Shapiro Family Foundation was said to have taken a massive hit (according to Boston Globe)

3)And Madoff's own foundation - Madoff Family Foundation - which you have to imagine is no more.

A good story from the AP about the impact, on real people, caused by Bernie Madoff's heinous actions:

http://biz.yahoo.com/ap/081220/ripples_of_a_fraud.html

We recently read that the Picower Foundation has hired attorney William Zabel to pursue a claim against Madoff.That is surprising, because Zabel himself was on the boards of several foundations which had invested heavily in Madoff securities.Check it out on the Foundation Directory online and InfoSeek.

If he is such an expert, as he claims, on legal issues relating to philanthropic foundations and trusts, why did he not warn these boards about the dangers of investing too heavily in any one type of fund or investment? Some of the groups were not well diversified, rather than having their funds under various money managers or funds.

So, there is another issue at stake, the fiduciary responsibility of foundation trustees and board members. Who represents the interests of the foundation donors and of the broader community that they are supposed to benefit? Foundations had better police themselves, or the policing will come from Washington in a form that no one desires.

Verify your Comment

Previewing your Comment

This is only a preview. Your comment has not yet been posted.

Working...
Your comment could not be posted. Error type:
Your comment has been saved. Comments are moderated and will not appear until approved by the author. Post another comment

The letters and numbers you entered did not match the image. Please try again.

As a final step before posting your comment, enter the letters and numbers you see in the image below. This prevents automated programs from posting comments.

Having trouble reading this image? View an alternate.

Working...

Post a comment

Comments are moderated, and will not appear until the author has approved them.

Contributors

Quote of the Week

  • "My favorite Civil War era monuments are the 13th, 14th, and 15th amendments...."

    — David Tenenhaus, professor of history and law, University of Nevada Las Vegas

Subscribe to Philantopic

Contributors

Guest Contributors

  • Laura Cronin
  • Derrick Feldmann
  • Thaler Pekar
  • Kathryn Pyle
  • Nick Scott
  • Allison Shirk

Tweets from @PNDBLOG

Follow us »

Other Blogs

Tags