Bernard Madoff is said to have told fellow inmates that he squirreled away a secret $9bn which prosecutors do not know about from his $65bn ponzi scheme fraud.

Bernie Madoff, who was jailed last year for 150 years after admitting to orchestrating the historic fraud, is reported to have channelled the funds to three individuals – whose identities remain unknown – shortly before he confessed to his crimes in December 2008. “I think it was personal friends,” one inmate is reported to have said.


The claims, made in the New York Post, are based on conversations with an inmate who spent time in prison with Madoff. It is the first time since Madoff’s crimes came to light some 19 months ago that there has been any formal suggestion – in spite of numerous rumours – that the former fund manager attempted to hide significant amounts of money from prosecutors and the police.

If true, it could prove to be a significant development for Irving Picard, the court-appointed trustee charged with uncovering Madoff’s secret assets, who is now likely to want to interview Madoff to find out where the money is.

The fellow prisoner also claimed that Madoff told him that the only other person to know of the identities of the three is Frank DiPascali, his former right-hand man, though it is not clear whether he knew money had been passed to them.

Mr DiPascali has pleaded guilty to 10 separate counts relating to the Madoff fraud and is currently working with federal prosecutors from jail to help them widen the case.

Madoff allegedly told the inmate – who is not named by the paper – that he suspects Mr DiPascali may be using information relating to the secret $9bn as leverage to shorten his own sentence. He has yet to be sentenced. Mr DiPascali’s lawyer declined to comment.

The New York Post account also provides an insight into Madoff’s alleged life behind bars, suggesting he sought the aid of a counsellor ahead of the release of Sheryl Weinstein’s book last year, in which it was revealed he had had an affair with the former investor.

“He was having problems with his wife [Ruth]” over the book’s revelations, the inmate is reported to have said. Madoff is alleged to have been prescribed anti-depressants as a result.

Madoff is said to have now taken a job in the prison shop at Butner, North Carolina, where he is serving his sentence, and has still yet to be visited by sons Andrew and Mark, who worked in Madoff’s securities business.

However, the inmate’s account of Madoff’s attitude to his victims does not tally with other recent accounts.

According to the New York Post’s description, Madoff “feels a lot of pain for what he did to” his thousands of victims, running contrary to a recent account in New York Magazine in which the fraudster is alleged to have said: “**** my victims. I carried them for 20 years, and now I’m doing 150 years.”

In that piece, he reportedly told one fellow prisoner that the crime was not fully of his own making, and that he felt unfairly caught up in the situation.

“People just kept throwing money at me,” Madoff told a prison consultant. “Some guy wanted to invest, and if I said no, the guy said, ‘What, I’m not good enough?'”

Via Telegraph