Mass. financiers on Madoff client list
File shows many state connections
Accused swindler Bernard L. Madoff's customers include some of the most successful business executives and financiers in Massachusetts, from a cofounder of technology giant EMC Corp. to buyout artists schooled at Bain Capital.
There appear to be hundreds of people, trusts, and companies from the Bay State who are current or past clients of Madoff, according to a list filed Wednesday in bankruptcy court in New York by the trustee appointed to oversee the liquidation of his investment firm. They include former Channel 5 television executive James Coppersmith; real estate magnate Gerald Schuster and his wife, Elaine; Howard Kessler, a financial executive who pioneered the use of affinity credit cards; and Allyn Levy, who once ran Patriot Bank.
Two on the list are Geoffrey S. Rehnert and Marc Wolpow, cochief executives of Boston private equity firm Audax Partners and former managing directors of the powerhouse buyout firm Bain Capital. Rehnert said Audax lost $6 million with Madoff, and that he and Wolpow also lost personal funds.
"It is a modest, though nonetheless painful and embarrassing loss," Rehnert said. Audax's private equity funds were not affected, he said.
Another is Roger Marino of Dedham, a founder of EMC Corp. and former co-owner of the Pittsburgh Penguins hockey team. Reached on vacation in Florida, Marino did not say how much he lost but called it "a lot of money." He said he had invested with Madoff for more than 10 years and described the scandal as "unfathomable."
"No one knew," he said. "There's no way you could have caught this guy."
Coppersmith and the Schusters did not return calls seeking comment yesterday. Kessler and Levy declined to comment.
The list does not include any mention of the sums investors had with Madoff.
Madoff has been charged with fraud and is under house arrest in his Manhattan penthouse. He is under investigation by the FBI and by state and federal securities regulators, who are trying to untangle a scheme that involved thousands of customer accounts across the globe.
Nationally, Madoff's alleged $50 billion Ponzi scheme ensnared Hall of Fame pitcher Sandy Koufax, actors Kevin Bacon and John Malkovich, a company linked to deceased singer John Denver, and TV talk show host Larry King, whose trust is listed as being run by a Waltham accountant.
The 162-page document includes thousands of names and was assembled by a company hired by bankruptcy trustee Irving Picard to serve as a mailing list for soliciting claims on the assets of Madoff's firm. However, the list appears to be a catchall that does not distinguish between current and former investors.
For example, one Brookline woman said she and her husband had not invested with Madoff for 20 years. Records also show that at least one person on the list is dead. Numerous financial and legal advisers, named because they received account statements on behalf of clients, are listed with corporate names that are out of date. And Cablevision Systems Corp. of New York said it should not have appeared on the list at all.
Secretary of State William F. Galvin, who is investigating Madoff losses among Massachusetts investors, said, "The condition of the list is kind of shocking."
It could well be that the man who allegedly ran a vast con - producing fake account statements with trades that never happened - was not keeping the tidiest of customer lists. Court filings say the list was compiled by culling Madoff's customer records, and adding people who contacted the trustee in recent weeks. Picard did not respond to a request for an interview yesterday.
Brandeis University appears on the list, but the school insists it has no direct investment with Madoff. The Waltham institution, suffering its own financial problems, has been rocked by the Madoff scandal, as a number of its wealthy donors lost millions. But it got on the trustee's list, a Brandeis spokesman said, because the school "routinely receives gifts of securities from donors' brokerage accounts."
Some people on the list lost large portions of their savings.
Joseph F. O'Connor of Mashpee said he gave Madoff $400,000 in 1992 and also had his pension invested with him.
"I was totally devastated on December 11th when we learned this happened," said O'Connor, a retired president of a manufacturing business. "But I got up on December 12th and said we've just got to live with what we've got. So now I'm living on Social Security because my life savings is gone."
Allyn Levy, 80, who ran the Patriot Bank in Boston before it merged with the Bank of New England in 1987, and his wife, Judith, have been major fund-raisers for Beth Israel Deaconess Medical Center. They are part of the Palm Beach, Fla., community that was deeply ensnared by Madoff. Their 6,300-square-foot Palm Beach home is currently listed for sale for $6.5 million.
Levy, reached in Palm Beach, declined to comment.
Other major Boston philanthropists, the Shapiro family and the Jaffes, are listed multiple times on the trustee's compilation. As previously reported, Carl Shapiro's family foundation lost about $145 million with Madoff, and he lost hundreds of millions more in personal funds. Shapiro was a longtime friend of Madoff. Robert Jaffe, Shapiro's son-in-law, is a broker who helped wealthy investors gain access to Madoff's investment funds. Jaffe and Shapiro have both said, through spokespeople, that they were as stunned by the scandal as anyone.
The list also includes many private individuals and trusts represented by a number of prominent Boston financial and legal advisers to wealthy families, including Mellon Financial, Mintz Levin Financial Advisors, and Bingham McCutchen.
Mintz Levin said it had a client who had funds with Madoff. Bingham McCutchen declined to say whether it had advised clients to invest with Madoff. "Beyond confirming that we have clients who have various involvements with the Madoff situation, we cannot comment because of attorney-client confidentiality," said Claire Papanastasiou, a spokeswoman for the Boston law firm.
One name on the list, Federal Street Advisors, said its two clients' names on the list were not invested with Madoff.
Many people could only wish their names appeared in error. John Nessel, a financial consultant in the hospitality industry, said he started wondering about Madoff's investment results in the months before the scheme unraveled. He started more closely tracking the options trades that Madoff reported on his monthly statements.
But On Dec. 11, Nessel said, he got a call from a friend. "He said, 'I hate to be the one to tell you this, but Bernie Madoff was just taken away in handcuffs,' " Nessel recalled. "I can't find words to describe the feeling I had." Nessel said he didn't lose everything, but he lost plenty. "I still have a home and make a pretty good living," he said, "so I'll survive."
Beth Healy can be reached at bhealy@globe.com. Casey Ross can be reached at cross@globe.com. 