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More Madoff scandal details emerge

December 31, 2008
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The financial whirlpool created by Bernard Madoff continued to churn yesterday as the price tag of liquidating his old firm rose, and duped investors including actors Kevin Bacon and Kyra Sedgwick struggled to accurately estimate how much they lost.

A publicist for the celebrity couple confirmed they were among the victims of what Madoff, according to the FBI, has described as a Ponzi scheme.

Yeshiva University, which had initially estimated its losses in Madoff's alleged scheme at $110 million, said yesterday its actual losses had been much smaller.

The university's chief financial officer, J. Michael Gower, said the school's principal investment in a hedge fund linked to Madoff had been $14.5 million.

On paper, that stake had exploded in value to $110 million, but Gower said all of those "profits" now appear to be entirely fictitious, meaning the losses were mostly fictitious, too.

Another victim of the alleged scam, the Robert I. Lappin Charitable Foundation of Salem, Mass., is reaching out to alumni to help save this year's planned Israel trip for Jewish youths.

The foundation is sending letters of appeal to alumni of the trips and their parents in an effort to raise $576,000 by Jan. 23.

Meanwhile, a US Bankruptcy Court judge approved the transfer of $28.1 million to cover expenses tied to the liquidation of Madoff's investment firm.

Also yesterday, three New York investors sued Madoff, saying he should have his assets permanently frozen and be prevented from continuing the alleged fraud.

Madoff is expected to comply with a deadline today to provide the SEC a list of his assets, liabilities, and properties.

Globe Wire Services

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