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After Madoff Sentencing, Trauma Persists

After Madoff Sentencing, Trauma Persists

Stephanie Halio of Boca Raton, Fla., said her biggest fear after the sentencing Monday of Bernard Madoff to 150 years in prison is that "we will be forgotten."

The "we" are the victims he defrauded in his estimated $65 billion epic fraud, a disproportionate number of whom are Jewish. Nearly 9,000 victims’ claims have been filed, but the total number of people affected is estimated in the tens of thousands.

"This is a nightmare in the Jewish community," said Audrey Freshman, the founder of a support group for Madoff investors. "People have been forced into tremendous hardship."

She said her online support group began in May after about 400 Madoff investors who were participating in two online advocacy groups began expressing emotional strain.

"The groups asked me to intervene because people needed a place to deal with their emotional upsets," Freshman said, adding that as a Madoff investor herself she was a member of one of the online groups.

"There needed to be a group that focused on the impact [of Madoff’s Ponzi scheme] had on these people’s lives," she explained. "My group focuses on people’s day-to-day existence."

Freshman, who has a doctorate in social work and specializes in trauma and recovery, said that in addition to her online group she is starting two face-to-face groups at her office in Rockville Centre, L.I.

"The ability to pay should not be an obstacle to help because people are very needy now," she stressed.

Freshman pointed out that trauma can render a person helpless with fear and horror. Sometimes trauma is caused by a natural disaster such as a hurricane, but sometimes it is caused by the "evil actions of human beings."

"The hardest to overcome are those caused by human evil, and he [Madoff] has created tremendous intergenerational trauma for years to come," she said.

The Madoff fraud scheme has hit Freshman’s own family hard.

"In my family, my father is a Holocaust survivor who had built up money and intended it for his grandchildren," she said. "That has been wiped out, as was money he had intended for Jewish philanthropy."

A New Yorker who asked that her name not be used to shield her family said her parents had invested much but not all of their money with Madoff.

"Whether families lost a lot or a little, there is a sense of trust that has been betrayed," she said. "My parents own my apartment and may have to sell it because they need money to live. … It’s incredibly painful to see your parents in pain. It was a huge emotional blow."

She said they went for emotional counseling and have now come to terms with their loss.

"They don’t eat out as much as they used to," she said of her parents, who are in their 80s. "The big issue now for them is the legacy they wanted to leave to their children. That legacy is gone."

There are other stories of Madoff investors who had to sell their homes because they could no longer pay the upkeep or the mortgage.

One 71-year-old man recently retired to New England to build his 2,500-square-foot dream house on a lake only to find his life savings gone in the Madoff scandal. He has had to sell his house and its contents, his boat and his car.

"He never married and his girlfriend has now left him," said a friend. "And the two charitable trusts he had set up for Israeli charities that were important to his parents are gone. He is devastated."

Miriam Siegman of Stamford, Conn., one of nine Madoff investors who addressed the court at his sentencing, said Madoff had "robbed" her and "discarded me like road kill." She said she now relies on food stamps, collecting recyclable bottles and foraging through dumpsters.

Another, Carla Hirshhorn, told Manhattan Federal Judge Denny Chin: "Life has been a living hell. It feels like the nightmare we can’t wake from."

Before Chin imposed sentence, Madoff turned to the victims sitting in the courtroom, apologized and said he "left a legacy of shame" and that he lives "in a tormented state now. … I don’t ask for any forgiveness."

Among the other stories shared on the Madoff investor support group was that of an elderly couple who believed they had invested well and were well positioned for the rest of their lives, but have now moved in with their adult children.

"They have had to uproot their lives and move out west to a place where they know no one," said a friend.

Another said she is now working 16-hour days with one day off in the last four weeks.

"I have been living in the basement of a friend’s house in an unfinished room smaller than the walk-in closet in my condo that I can’t afford to live in," she wrote. "My aunt is 87. She can’t make expenses and is ill. It shatters my heart to speak of her. Her daughter and family also hit by the scandal. My future? Hell, how about right now!!!!"

Halio of Boca Raton said she is upset about all of the anti-Semitic vitriol aimed at the Madoff victims.

"There are filthy, disgusting lies being told about Jews," he said. "People love to hate Jews and they see this as an opportunity to put their teeth into someone. They say Madoff was a crook, he’s Jewish and all his clients are Jewish and crooks and can never be trusted. They say Jews were all in on this scheme and that they are glad they got what they deserved. I heard old-time WASPs in Florida saying, ‘Now maybe we’ll get our island back.’"

But Halio stressed that the "vast majority" of Madoff victims are not Jewish but rather people and pension funds that had invested in funds that in turn invested with Madoff. Many of them did not know it and never heard of Madoff.

Ilene Kent of Manhattan said she did not like being called a Madoff victim. She preferred, she said, to be called a "Madoff survivor."

"In some instances what people lost was a lot, in others a little," she said. "For some — not many — what they lost was only a blip on the radar. Others have experienced serious financial loss. We’re all a group of people brought together by financial calamity."

She pointed out that Madoff investors formed two online emotional support groups within a week or so after Madoff’s Dec. 11 arrest. But Kent said those two groups quickly "morphed into advocacy groups fighting for legislative changes to the bankruptcy laws" to better protect investors.

"Not only did we suffer a loss, but we realized there was no one there to help us through the process," Kent said. "We had to figure it out for ourselves.

"Anytime people are thrown together you are going to have disagreements. I’m not a health care professional, but I think people were misplacing their anger and striking out at each other in this group. … I think Audrey’s support group is extremely important because a lot of people don’t realize how they have been affected by this. It’s like death, which has different stages — disbelief, sadness and then anger."

On one of the Madoff investors’ sites, Kent said she posted phone numbers for depression and suicide hotlines. Shortly after posting it, she said she received an e-mail from a 79-year-old man who said he lives alone in the Midwest.

"He asked if those numbers are good where he lived," she said. "Some of these people have nothing left."

Madoff investors wishing to join Audrey Freshman’s counseling group should call her office at (516) 678-2549 or e-mail her at The 90-minute groups begin meeting July 6 at 7:30 p.m. and July 9 at noon.

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