December 11, 2008, was the beginning of a financial nightmare for thousands of people after word got out that financier Bernie Madoff was arrested for running the biggest Ponzi scheme in U.S. history.
While the media initially touted Madoff’s fraud as having run upwards of $50 billion, prosecutors would later raise the estimate to $65 billion among his 37,000 victims, who ranged from prominent figures in business and media and hardworking, everyday people to nonprofit charities.
Many of his victims emerged to share their stories as part of a larger narrative of the shocking fraud, it was his celebrity clients who made the biggest headlines.
Some public figures chose to stay relatively quiet about their association with Madoff. Before her death in 2016, Hungarian-born actress Zsa Zsa Gabor had reportedly lost between $7 to $10 million from investing with the money manager, while Hollywood bigwig Steven Spielberg’s Wunderkinder Foundation also took a substantial hit, although the dollar amount was never disclosed.
Still, other prominent figures decided to speak out about their financial losses and what they learned from the experience. Among them are actors and couple Kevin Bacon and Kyra Sedgwick, Dreamworks Animation chief executive Jefferey Katzenberg, actor John Malkovich, Holocaust survivor Elie Wiesel, and broadcaster Larry King.
Kevin Bacon and Kyra Sedgwick
Known to be a low-key Hollywood couple, actors Bacon and Sedgwick became front and center news when the scandal broke, as they had been one of the first celebrities known to have reportedly lost millions of dollars investing with Madoff.
“I see him as a sick man,” Sedgwick told Piers Morgan on CNN in 2012. “And I see us as adults who made a choice. And I see a lot of people who are so much worse off than we are…”
Years later, Bacon echoed his wife’s sentiments about the scandal. “It was a bad day,” Bacon admitted to The Guardian during an interview in 2017. “But pretty quickly we were able to see all the things we had as opposed to whatever we lost, and those are the biggest cliches: children, health, love, a nice home. So we got through it together. I don’t think about Madoff, like, at all.”
He also added that the “real victims” were those who lost their entire life savings. “I think there’s a good cautionary tale there, to be cognizant of what’s happening with your money.”
Just like Bacon and Sedgwick, Dreamworks Animation executive Katzenberg, known for producing hits like the Shrek and Kung Fu Panda franchises, endured a substantial financial loss, which he described as “painful and humiliating.” Although he also refused to discuss the actual dollar amount that was taken from him and his charitable organization, Marilyn & Jeffrey Katzenberg Foundation, the charity had estimated assets of over $22 million before the scandal broke.
The Los Angeles Times would later uncover that Katzenberg had lost $20 million. Both he and Spielberg shared the same business manager, who made investments with Madoff on their behalf.
“The first time I heard the name Bernie Madoff was about three weeks ago,” Katzenberg told reporters in January 2009. “What it has done to other people is terrible. It’s destroyed many people’s lives. People that I know.”
Before his death in 2016, Holocaust survivor and Nobel Peace Prize winner Wiesel was another famous figure taken in by Madoff’s criminal enterprise. And when the news hit, Wiesel didn’t take the loss lightly.
Describing Madoff as “one of the greatest scoundrels, thieves, liars, criminals,” Wiesel and his wife, Marion, had lost their life savings of $12 million, along with $15 million from their nonprofit organization, Elie Wiesel Foundation for Humanity.
“Could I forgive him? No,” Wiesel told a media panel in New York City in 2009 regarding Madoff. “To forgive, first of all, would mean that he would come on his knees and ask for forgiveness. He wouldn’t do that.”
Wiesel explained that a wealthy trusted friend, who had been friends with Madoff for five decades, introduced the two of them. After Wiesel met with Madoff multiple times, he went on to get advice from other financial experts before entrusting his personal finances with Madoff.
In 2012 he reflected back on his experience during an interview with Oprah Winfrey. “[My wife and I] looked at each other, and our reaction was, ‘We have seen worse,’” Wiesel said. “Both she and I have seen worse.”
Once news spread about his foundation’s financial troubles, Wiesel said he was taken aback from the public’s reaction.
“All of a sudden, we began receiving hundreds and hundreds and hundreds of letters and donations, small donations, from all over America, Jews and non-Jews,” Wiesel told Oprah. “The American people are so generous. … We received hundreds of them, and that helped us.”
When actor Malkovich lost his investment of $2 million dollars to Madoff, he — like fellow actors Bacon and Sedgwick — put his problems into perspective.
“I don’t view it as a negative experience…,” he told Details magazine in 2013. “To me it was, ‘You think you have a bunch of money – and you don’t.’ So what? Most people don’t (have a lot of money). I think it kind of reconnected me to how most people live all the time. And, unlike a lot of people that were involved in the Madoff thing, I could just go back to work, and it was fine.”
So would he say anything to Madoff if he had the opportunity? Malkovich told Vanity Fair, in his classic cool demeanor, not particularly.
“I only met Mr. Madoff once, many years ago. He seemed very pleasant. But, you know, I don’t think I’d have much to impart,” he told the magazine in 2013. “For me, in all honesty, it was a good life lesson.”
In the end, Malkovich reportedly received $670 thousand of his investment back.
King met Madoff through his childhood friend Fred Wilpon, owner of the New York Mets. At the time, King and his wife were looking for a reputable investment firm, and Wilpon suggested he look into Madoff but warned King that the money manager was known for being selective about his clientele. King experienced Madoff’s choosiness firsthand, as the latter accepted King into his firm but not King’s brother.
When Madoff was arrested in 2008, the broadcasting legend suffered a $700K loss but thankfully, was able to recover it within a few years.
“If I could interview one person on the planet, it’d be Bernie Madoff and the obvious [question] would be ‘Why? Why did you do this to people?'” King said.
King’s friend, Wilpon, would come out of the Madoff scandal much worse off, taking a hit of $500 million.