Divorce, Equitable Distribution, Imprisonment, RICO
Where was I reading? It think it was the Wall Street Journal Deal book and this professor from, I believe, Wayne State University, wrote this article about Ruth Madoff getting to keep her penthouse and he suggested that under the anti-racketeering statutes, the government will likely seize everything however tangentially related to Bernie including Ruth’s penthouse and everything “marital” that the ponzi bought.
I wouldn’t exactly be shocked. But as I have asked before, what portion of the marital assets should go to Ruth as a sort of “property settlement”, if any, given that when her husband is carted off to prison (he’s expected to plead guilty next week and then get sentenced) it would effectively leave her, not a widow, not a divorcee, but a sort of mash up of the two, except that she may not get any alimony and she may not get any equitable distribution and will effectively be “reduced to the welfare rolls.”
All because of some law called RICO (Racketeer Influenced and Corrupt Organizations statute). As I asked before,
with all due respect to RICO whatever happened to the corporate shield? There is such a thing as “personal assets” and that should be exempt from forfeiture unless there is a good reason to pierce the veil. As for the substitute assets, that seems like a really broad brush approach to justice. At the same time, Domestic Relations law suggests that what is Ruth’s is Bernie’s and what is Bernie’s is Ruth’s if earned during the marriage. Even gifts. So what would be the basis of treating the loot as Ruth’s “separate” property. It would be like allowing Bernie to keep the loot, which would seem slightly inappropriate under the circumstances….but then again, maybe these are assets Ruth brought to the marriage. So then, it would be off the table completely as her “separate” property and thus could not be seized.
I bet you if Ruth re-marries (she can get a divorce after 3 years and just like Tammy Fay Baker she can get married to someone else while her husband rots in jail) she won’t make the same mistakes she made with her first husband Bernard Madoff. What mistakes? Well, for one thing, I bet you Ruth wishes that she had…cohabited without the benefit of marriage for at least a decade. That way, all the money she got would be “separate property.” Then, she would have executed a prenup with Bernie to keep separate property separate even if “commingled.” Then she would have married him to “legitimize” the kids and pets. Then, she would have substituted the “separate” assets for something else (“substituted assets” are treated slightly differently according to the article I read on WSJ but I can’t find the article now which is maddening…) like from cash to commercial real estate or something and for sure she wouldn’t be in this predicament…
It was a mistake. the whole thing was a mistake. I don’t want to say her marriage was a mistake because that is disrespectful. But the ponzi was a big mistake. The post-arrest shenanigans are fishy. And she’s asking to keep a ton of money and the $7 million dollar penthouse. That makes her look oblivious….mistakes, mistakes, mistakes….
where am I going with this? Dunno. Let’s talk about Elliott Spitzer instead cause I think I’ve done enough Madoff stories and I am starting to repeat myself and it’s boring and inappropriate. http://www.divorcesaloon.com/elliott-spitzers-recently-acquired-building-near-dc-mayflower-hotel-fair-game-if-he-divorces
btw, I found the article on WSJ http://dealbook.blogs.nytimes.com/2009/03/05/but-seriously-can-ruth-madoff-keep-the-penthouse/