Mar 16, 2009 5:30 pm US/Eastern
Madoff Probe Turns Focus To Wife, Family
Investigators Seek Freeze On Wife's Assets Totaling $69 Million
NEW YORK (CBS) ―
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Bernard L. Madoff pleaded guilty last week to defrauding investors of billions. He was sent to a Manhattan correctional facility to await sentencing that could amount to 150 years.
Timothy Cleary/Getty Images
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Bernie Madoff will await his sentencing in a cell like this one at the Metropolitan Correction Center in lower Manhattan.
CBS
As confessed scam-artist Bernard Madoff sits in a New York City jail, federal investigators turn their attention to his wife and family, reports CBS News correspondent Randall Pinkston.
Authorities are working to freeze the assets of Ruth Madoff - $69 million that they don't believe is hers.
In a court filing, the government said it will seek the $7 million Manhattan penthouse as well as another $62 million that Ruth Madoff had sought to keep.
According to court documents filed Friday, the Madoffs had nearly a billion dollars in personal wealth at the end of last year, including:
- $45 million in securities
- $17 million in the bank
- $2.6 million in jewelry
- Homes in New York, Florida and France worth $22 million
The grand total is $823 million and, of that total, some question how Ruth Madoff possible could have earned $69 million.
"Her father had no money. He left her $37,000," Franks said. "The only source of income that we think that Ruth Madoff had was when she wrote a cook book and, indeed, it was not a best seller."
Ruth Madoff hasn't been accused of any wrongdoing at this point. And her husband isn't talking.
"He's refusing to identify where the assets or who his co-conspirators are," Brad Friedman, the attorney representing Madoff investors, told CBS News.
Defrauded investors are suing to recoup the money they lost in Madoff's scam. And even though the Securities Investor Protection Corporation, a non-profit set up by brokerages for cases of fraud, has paid $6 million dollars to 12 investors, president Stephen Harbeck says there are more than 5,000 claims. The SIPC only insures investment funds up to $500,000.
Possible candidates for further investigation are Madoff's sons, brother and niece, all of whom he employed.
"He paid Shana, his niece, the compliance legal counsel, we think it's $650,000," says Franks.
There is also another $70 million in question, allegedly placed under Ruth Madoff's name in New York and London banks.
Saying he could not "adequately express how sorry I am for what I have done," Madoff pleaded guilty last week to defrauding investors of billions. His bail was immediately revoked and he was sent to a Manhattan correctional facility to await sentencing that could amount to 150 years.
He has filed an appeal on the bail decision, with his lawyers saying he had not been a flight risk leading up to his guilty plea, even though he could expect to die in prison.
His sentencing is scheduled for June 16.
(© 2010 CBS Broadcasting Inc. All Rights Reserved. This material may not be published, broadcast, rewritten, or redistributed. The Associated Press contributed to this report.)
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