Shapiro's Madoff investments under scrutiny

By Beth Healy
Globe Staff / May 19, 2009
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Even if Boston philanthropist Carl Shapiro was among Bernard Madoff's favored investors, he wasn't getting as good a deal as the Picower Foundation, according to a person briefed on the Shapiro investments.

Jeffry Picower was sued last week by the court-appointed trustee in the Madoff case, who alleged that Picower should have known that investment returns of 500 percent or 950 percent his foundation was receiving from Madoff were fraudulent. Shapiro's returns weren't "anywhere near" those triple-digit gains, the person briefed on his investments said.

Shapiro's lawyers have been unwilling to discuss his case, and the family, dismayed by the publicity since Madoff confessed to a multibillion-dollar Ponzi scheme in December, declined to be interviewed. Shapiro, a longtime friend of Madoff's, is under scrutiny in part for having invested $250 million with Madoff in the final two weeks before the scheme fell apart.

The Wall Street Journal reported yesterday that Shapiro and his son-in-law, broker Robert Jaffe, are part of an inquiry by the US Attorney in New York into some of Madoff's largest customers. The US Attorney's office declined a request for comment. A spokesman for Shapiro and Jaffe declined to say whether the men had been contacted by prosecutors from New York. Both men have said through a spokesman that they were victims of Madoff.

Shapiro has acknowledged losing at least $400 million to Madoff, including about $145 million from The Carl & Ruth Shapiro Family Foundation, a Boston charity that funds hospitals, universities, and Jewish causes.

Secretary of State William F. Galvin's office is continuing its inquiry into Jaffe. It has no jurisdiction over Shapiro because he is not a broker or securities firm.

The Picowers deny any knowledge of Madoff's fraud.

Beth Healy can be reached at

Carl Shapiro of Boston is part of a US Attorney in New York's inquiry into Bernard Madoff's largest customers.

LOST $400M