Blog Network

About The Bloggers


Madoff Mess Hits Funding for Legal Groups

Fallout from the collapse of disgraced financier Bernard Madoff's alleged $50 billion Ponzi scheme continues, with news of several legal foundations and organizations losing funding because their endowments were tied to investments in Madoff's funds. The National Law Journal identifies eight legal groups, from the ACLU to the Center for International Environmental Law, that are losing part or all of their endowments. The worst-affected group mentioned in the article is the JEHT Foundation (the acronym stands for justice, equality, human dignity and tolerance), which last year gave out $24 million, mostly to criminal justice advocacy and reform organizations., The Open Society Institute and Atlantic Philanthropies highlight several other legal organizations facing Madoff-related funding cuts, including New York University's Brennan Center for Justice, Human Rights Watch and Advancement Project, according to Philantropy 2173. MoveOn is organizing a grassroots effort to generate individual donations to each of these groups to "help repair some of the damage Madoff has done."

In other Madoff news, Bloomberg reports that in Sept. 2000, Weil, Gotshal & Manges corporate governance specialist Ira Millstein cleared financier J. Ezra Merkin to continue to accept Yeshiva University (with which Benjamin N. Cardozo School of Law is affiliated) as an investor, even though Merkin was a trustee on the school's investment committee. Yeshiva invested in Merkin's company, Ascot Partners LP, which in turn put the money in Madoff's funds. According to the New York Times, Yeshiva lost $110 million investments with Madoff, who himself had been on the school's board of trustees since 1996. Ira Millstein's legal advice was consistent with professional standards, according to the Bloomberg article, but the entire affair represents "[a] lack of due diligence," says Hank Higdon, an executive recruiter quoted in the piece. "That's where they fell down and that is inexcusable. You cannot assume that everything is OK because someone is on your board and has a good reputation."

Posted by Product Team on January 2, 2009 at 04:34 PM | Permalink | Comments (0)


About ALM  |  About  |  Customer Support  |  Privacy Policy  |  Terms & Conditions