Madoff`s Ultimate Victim

MADOFF’S
ULTIMATE
VICTI
BERN IE M A DOFF SW IN DLED IN V ESTORS OU T OF
MILLIONS, BU T A F TER THE SU DDEN SU ICIDE OF
HIS ELDER SON, M A RK , IT’S HIS DAUGHTER-IN-L AW
W HO SU FFERS THE MOST TR AGIC FATE OF A LL .
BY ANNIE K ARNI
day—why would she need to send someone to
look after their 2-year-old son? Then she saw a
second message from Mark. The subject line read
“I Love You.” Inside, the message was blank.
Stephanie panicked.
She immediately dispatched her stepfather,
lawyer Martin London, to her family’s apartment on Mercer Street in Soho. At 7:27 a.m., he
found Mark, clad in khakis, a blue shirt and white
socks, dangling from a black dog leash fashioned
into a noose, attached to a beam in the living
room ceiling. At the age of 46, he was dead. Little
GI/BM/ GETTY IMAGES; WILLIAM FARRINGTON
I
n the early-morning hours of
December 11, 2010, Stephanie
Madoff was just waking up at her
hotel in Orlando, Fla. It was a balmy
68 degrees, and the daughter-in-law
of Ponzi schemer Bernie Madoff had
spent the past few days on a whirlwind Disney World excursion with
her 4-year-old daughter, Audrey, and her mother,
Pinks London. They were scheduled to fly back to
Manhattan the following day.
The mother-daughter trip was intended to
make for happier memories than the date it coincided with: the two-year anniversary of Madoff’s
arrest for bilking investors out of $65 billion.
It was sometime after 6 a.m. when Stephanie
checked her phone for messages. She saw an
e-mail from her husband, Mark, the elder of
Bernie Madoff’s two sons. “Send someone to take
care of Nick,” he’d written. The urgent tone put
Stephanie on edge. She was due back the next
Stephanie
Madoff
walks her
dog, Grouper,
in Soho in
February.
Two months
earlier, her
husband,
Mark, took his
life using one
of their dog’s
leashes. Left:
Mark with
Bernie and
Ruth Madoff
in 2001.
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TI M
Stephanie in
an undated
Facebook
photo, with
her husband,
Mark, and
daughter,
Audrey.
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Emergency
workers leave
Stephanie and
Mark’s Soho
apartment on
December 11.
Mark killed
himself earlier
that morning,
two years
to the day
after he first
learned of his
father’s fraud.
Mikesells were wealthy: Stephanie’s
father ran a management consulting firm
based in London, and her mother worked
as a private tutor for children with learning disabilities. Her parents divorced
when she was young, and her mother
married Martin London, a high-powered
attorney at the white-shoe law firm Paul
Weiss, who once served as a lawyer for
Jackie Kennedy Onassis.
Stephanie was a Nightingale-Bamford
“survivor,” i.e. one of the few students
to attend the tony $37,150-a-year private
school from kindergarten through senior
year. Her classmates included Debra
Perelman, billionaire corporate raider
Ron Perelman’s daughter, who was a close
friend growing up.
“She was always considered sweet
and guileless,” says former Nightingale
student Alexandra Elliott Andrade, 36.
“There was nothing ever mean about
Stephanie. She was popular, but she wasn’t
one of the wild girls. ” Andrade adds: “She
was more a sheep than a leader.”
Unlike classmates crippled by familial and peer pressure to excel amid the
Masters of the Universe set, Stephanie
was comfortable and “seemed to have no
idea about all the money and power and
prestige around her,” says Andrade. “She
was always just Stephanie.”
During the summer after her high
school graduation, her father died of
undisclosed causes at the age of 46—
eerily, the same age at which her husband
would later take his own life.
It’s unclear what effect this early brush
with loss had on Stephanie, who, according to friends, didn’t date in high school.
“She was very tame,” says Andrade. She
ultimately went on to college at Franklin
& Marshall, a small, preppy liberal arts
school in Lancaster, Pa.
After graduating in 1996, Stephanie
moved back to Manhattan. Her stepfather helped her land a job as an assistant
at George magazine, the politics-andcelebrity glossy co-founded by John F.
Kennedy Jr.
Stephanie’s former boss, Matt Berman,
creative director of George and currently
the head of his own creative agency, recalls
Stephanie as a hard worker. “She turned
out to be perfect. It was a tense office; we
were shooting a cover every three weeks
and we had celebrities calling all the time.
It was the kind of position that needed
someone sharp with a good attitude.”
Colleagues remember Stephanie
as a capable assistant, always well put
together and friendly, who brought a positive energy to the frenetic workplace.
“I remember her saying to me, ‘Demi
Moore is on the phone—and I think she’s
really mad,’ ” recalls Berman. “It was great
to have an assistant like Stephanie, who
would put you in a good mood and make
you laugh.”
Berman recollects a card he received
from Stephanie a few years ago—a picture
of her head surrounded by thought
bubbles containing “all the sayings of the
crazy people we used to work with.”
“It made me laugh,” he says.
When the magazine folded in 2001,
WILLIAM FARRINGTON; ALTAFFER/AP IMAGES
Nick was still slumbering peacefully in a
nearby bedroom.
Mark had left no suicide note behind.
“I Love You” and a blank e-mail was all
Stephanie had left.
When Bernie Madoff was arrested in
2008 for committing the biggest financial
fraud in history and sentenced to 150
years in jail, it seemed as if the worst possible tragedy had befallen Stephanie and
her husband of five years. But now, after
attempting to pick up the pieces of their
shattered lives, Stephanie, 35, had her
world shaken to its core once again.
A close confidant of Stephanie’s who’s
known her for more than a decade puts it
simply: “Her whole life was ripped open
two years ago. And then it was ripped
open again.”
Back in Orlando, Stephanie frantically
packed her bags and shuttled her daughter and mother back to Manhattan, only
to find her doorman fighting off hordes
of camera crews and reporters clamoring
for details of yet another Madoff disaster.
Stephanie’s first reaction was fury,
according to the confidant.
“She was angry at first, but now she’s
just heartbroken,” says the friend.
And betrayed. While thousands of
investors had lost their life savings to
Madoff, Stephanie lost not just money or
her standing in the community; now she’d
lost her adored husband, who, it seemed,
could no longer bear the stigma of his family name. As a result, friends say, Stephanie
sees herself as the person most damaged
by Bernie Madoff—his biggest victim yet.
Throughout the Madoff scandal,
Stephanie, a pretty, all-American blonde,
had managed to avoid the limelight.
Pictures of her on the Internet are scarce,
and to a large extent she’s managed to
stay out of countless stories scrutinizing
her family. She declined to be interviewed
for this story.
But friends and former colleagues
describe the Madoff widow as devastated—a woman who is simply trying
to navigate single motherhood in the
aftermath of overwhelming tragedy.
The deceit, fraud and pain were foreign
territory for a sweet girl who had, until
2008, lived a cloistered life of privilege.
Stephanie Madoff, née Mikesell, grew
up on Manhattan’s Upper East Side. The
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Bernie Madoff
pictured with
sons Mark
(far left) and
Andrew in
Montauk,
Long Island,
in 2001.
Meanwhile, Mark was raking it in. He
was paid about $30 million in compensation between 2001 and his death, according to a civil suit filed against him in
2009, and is accused of receiving a total
of about $66.9 million in illegal profits
while working for his father.
But Mark didn’t realize there was
anything improper about his wealth, and
he wasn’t shy about spending their growing mountain of cash. He once racked up
a $77,388 bill with a Connecticut-based
aviation company to charter a plane while
vacationing on Nantucket, according to
Jerry Oppenheimer, author of Madoff with
the Money.
In 2007, Stephanie and Mark started
the private Mark and Stephanie Madoff
Foundation, intending to donate some of
their money to charities. But tax records
show they parked about $2 million
in the fund and didn’t make a single
disbursement between 2007 and 2009.
(The foundation, along with the Madoff
estate, was sued in 2009 by Irving Picard,
the court-appointed bankruptcy trustee
representing Madoff’s victims.)
Just two months before Bernie
Madoff’s Ponzi scheme was unmasked,
Stephanie played the role of pictureperfect Nightingale alum, hosting the
school’s annual Metropolitan Area Alumnae reception at the couple’s Soho loft.
“A lot of the girls from Nightingale try
to reinvent themselves,” says Andrade,
who caught up with Stephanie over
drinks before the Madoff scandal broke.
“Stephanie was who she was.”
It was 10:30 a.m. on Dec. 10, 2008,
when Bernie called his two sons, Andrew
and Mark, and his brother, Peter, into
his 19th-floor office. The annual office
holiday party was scheduled for later that
evening at Rosa Mexicano on the East
Side, and the sons reportedly didn’t think
anything was out of the ordinary.
Bernie told them he needed to talk
to them, and when they reached their
father’s Upper East Side apartment, he
confessed that his entire company was “all
just one big lie,” describing it as “basically
a giant Ponzi scheme.” “I’m finished,” he
told his sons. “I have absolutely nothing.”
Mark and Andrew left Bernie’s apartment and immediately phoned Stephanie’s stepfather, Martin London, who
GI/BM/ GETTY IMAGES
“S T E P H A N D
a little over a year after JFK Jr.’s death,
MARK SEEMED
Stephanie scored a job as an assistant to
fashion designer Narciso Rodriguez.
R E A L LY I N L O V E .
“We worked together for six years, and
IT SEEMED LIKE
I consider her family,” Rodriguez, one
T H E Y W E R E E N JO Y I NG
of Michelle Obama’s favorite designers,
EACH OTHER.
tells Page Six Magazine. “She’s a down-toIT ALL SEEMED
earth, kind, loyal and sweet woman. She
T O TA L LY NOR M A L .
was an ace assistant and an important
YOU’D NEVER GUESS
part of my team.”
IN A MILLION YEARS
While Stephanie threw herself into
work for Rodriguez, the close confidant
THAT THE THOUGHT
says she was also eager to get married
[OF SUICIDE] WAS IN
and start a family. She was eschewing late HIS HEAD.”
nights at the bar for early mornings at the
—STEPHANIE’S FORMER
gym and, at 26, was over the single-gal life B O S S , M A T T B E R M A N
in the city. She was ready to settle down.
That same year, a friend asked Stephanie if she’d be willing to be set up on a
Stephanie didn’t mind that he came
blind date with a handsome, Jewish mon- with baggage—she was in love.
ey manager. She agreed, and on their first
Within a year of their first date, the
date, Stephanie and Mark Madoff, then
couple was engaged, and they married
36, spotted a piece of themselves in each
in Nantucket in 2003. Stephanie wore a
other. Both were athletic, into fishing
one-of-a-kind dress designed by her boss,
and family-oriented. Both were known as Narciso Rodriguez, who recalls that “they
popular but low-key people. Both came
made a beautiful couple.”
from well-to-do families and remained
In 2005, they moved into a $6 million
close with their parents. The confidant
apartment on Mercer Street, where
describes the duo as “kindred spirits.”
neighbors in the building include Jon
It was clear that Mark had the right
Bon Jovi and hotelier André Balazs.
pedigree. He’d grown up in Roslyn, Long
They later purchased a $6.5 million
Island—rich, gregarious and considered
mansion on Nantucket on 3.3 acres of
the “golden boy.” At the University of
land. (The property is currently on the
Michigan, he pledged Sigma Alpha Mu,
market.) Their parents socialized with
the go-to fraternity for rich “golden boys” each other, vacationing as a group.
from the East Coast, and after he graduMark’s two young kids from his first
ated he went straight to work for Bernard marriage would visit about twice a week,
L. Madoff Investment Securities.
according to her close friend, and StephaHaving divorced the mother of his first
nie got along with them. After four years
two children, Susan Elkin, in 1999, he was of marriage, their daughter, Audrey, was
also ready for a fresh start.
born, followed two years later by Nick.
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Mark walks
his dog in
November
2009. Below:
Just over a
year later,
a shocked
Stephanie is
snapped two
days after
news of her
husband’s suicide emerged.
The incident apparently served as something of a wake-up call—Mark reportedly sought counseling, and by the fall
of 2010, friends say, Stephanie and Mark
were getting back on their feet. Mark,
who struggled to find a job and reportedly
considered himself “unemployable,” was
attempting to launch a subscriptionbased real estate newsletter.
“Stephanie’s not the type to wallow,”
says the friend. “She said, ‘We’re going to
move forward and live our lives.’ ” When
Stephanie began to receive death threats,
she took swift and decisive action. Last
February, she legally changed her and
her children’s surname to Morgan, citing fears for her children’s safety. Mark
reportedly agreed to the name change.
Her former boss at George, Matt Berman, who lunched with the couple just
weeks before the suicide, says nothing
seemed out of the ordinary. “Steph and
Mark seemed really in love,” he says.
“It seemed like they were enjoying each
other. It all seemed totally normal. You’d
never guess in a million years that the
thought [of suicide] was in his head.”
By the time Stephanie returned home
from Florida, she was in shock and was
spotted driving away from her home
wearing a black beret and sunglasses,
looking stunned in the passenger seat of
her stepfather’s SUV.
The family decided not to have a
funeral, in order to avoid more unwanted
attention. Mark was cremated a few days
after his death, and the family held a
private memorial service in Greenwich,
Conn. Stephanie barred Mark’s mother,
Ruth—who had flown from Florida to
Greenwich—from attending the service,
according to People magazine.
“Regardless of what you feel about my
father-in-law and his monstrous crimes,
Mark’s children are innocent victims, and
this is tragic for them,” Stephanie said in
a statement at the time. “I am devastated
and now raising two small children alone…
I will miss him and love him forever.”
Since the suicide, Stephanie’s friends
say they’ve offered her their support.
“I let her know that I’m right around the
corner, if she wants to go see a movie, or
have a laugh, or needs a babysitter,” says
Berman. “She’s been responsive. I haven’t
seen a lot of her, but we’ve been texting
back and forth.”
“She has faced great tragedy with grace
and humility,” says Rodriguez. “We still
speak often, and I care about her very
much. She is still loved by everyone at my
company.”
Three months after her husband’s
suicide, Stephanie continues to live in the
Soho penthouse where Mark took his life.
She doesn’t want to create more upheaval
for her children, the confidant says.
Or, perhaps, herself. Stephanie is still
living in limbo, uncertain whether the
future will leave her financially destitute.
The litigation continues against the estate of Mark Madoff, even after his death.
Picard, who would not comment on the
case, is seeking to recover all the money
spent by the family members as well as
whatever assets they retain.
In 2007, Stephanie dropped out of the
world of fashion and now attends school
part-time to earn a master’s in child
development at Mount Sinai. But while
she copes with the loss of her husband
and waits for the other shoe to drop, her
entire focus is her children, friends say.
“The kids are the center of her life,”
says the family source, sounding resigned
over the tragic situation. Right now, at
least, “it’s where she puts everything.”
DANIEL SHAPIRO; DOUGLAS HEALEY
referred them to another lawyer at Paul
Weiss. By the end of the day, the sons were
turning their father in to the SEC and talking to federal prosecutors. Both sons, who
worked closely with Bernie, felt deeply
betrayed by a father they had worshiped.
After Bernie Madoff was sentenced, his
family members were left to live with the
shame of his tainted last name and the
fact that they had unwittingly abetted the
greatest financial crime in history.
The one saving grace for Stephanie, according to friends, was her absolute faith
in her husband’s innocence. She never
questioned that he’d learned of the Ponzi
scheme only a day before the news broke
to the world—and she admired him for
immediately turning his father in. While
Andrew Madoff’s wife, Deborah, filed for
divorce the day the news broke (the marriage had already been on the rocks and he
already had a new girlfriend), Stephanie
stood by Mark.
But in the months that followed Bernie’s arrest, Stephanie watched her husband struggle. While his brother forged
ahead, going into business with his now
fiancée, Catherine Hooper, to create a
“disaster planning” consulting firm called
Black Umbrella, Mark allowed himself to
fall down the rabbit hole and read his own
press, according to a family source familiar with Mark’s emotional descent.
He had difficulty coping with the implication that he’d aided the crime and the
rumors that he was under criminal investigation. He was disturbed by the fact that
his preschool-age children were named in
a lawsuit by the bankruptcy trustee.
Mark cut off all communication with
both his parents and drifted further away
from Andrew. “Andrew handled it one
way and Mark handled it another way,”
says the family source. “It didn’t leave
them with all that much to talk about.”
Even with Stephanie—whose parents
were Madoff investors—standing firmly
at his side, the cracks in Mark’s emotional
state began to show.
In October 2009, Stephanie called the
police at around 1:30 a.m. and reported
her husband missing after he’d left the
house distraught and hadn’t returned after several hours. Mark finally resurfaced
the following morning and confessed he’d
spent the night at the Soho Grand Hotel.
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