In June, 2008, Mark again used his father's money, to buy a $6.5 million beach house on Nantucket, the exclusive island retreat off Cape Cod. The home is on the ocean in the Tom Nevers section, with five bedrooms, four baths, a hot tub, and separate guest quarters. The money came directly from the firm's account as a "loan" to Mark and his second wife, Stephanie, at 3.2 percent a year. An investigator for the bankruptcy trustee found no "records of any interest or principal" being repaid by Mark and "no apparent benefit" to the firm for offering the loan. In effect, money stolen by his father paid for Mark's summer beach house.
Although he was the younger brother, Andy was no less well rewarded for being Bernie's son. The foundation he set up with his now estranged wife, the Deborah and Andrew Madoff Foundation, had more than $4 million. Andy had survived a scare with lymphoma in 2003 and his parents "doted on their baby," according to someone close to Ruth.
Even as the markets neared collapse in September of 2008 and Madoff was beginning to see trouble on the horizon, he still had enough money to help Andrew buy a $4 million apartment in New York City, on East 74th Street overlooking the East River. He closed on the property on October 6, three weeks after the bankruptcy of Lehman Brothers, when his father was already in a desperate scramble to raise money from new and old victims and avoid the detection of his crimes. The $4 million came directly from the money investors entrusted to Madoff.
If nothing else, Mark and Andrew now face the almost certain loss of anything they own that was paid for by their father. Mark's home in Nantucket, and Andy's New York apartment were financed by Madoff at a time the government contends his criminal scheme was well underway. The sons also remain under scrutiny by the FBI, which does not accept Madoff's statements that he "acted alone." His decision to "confess" to his two sons and arrange for them to call the FBI was designed to divert any suspicion of Andrew and Mark. But for many, it seemed too obvious.
"What would you do if you were a father trying to protect his sons," asked Suzanne Murphy. "'I'm going to say you knew nothing about it, because I'm seventy years old, you're forty, you've got children. So I will take the fall for this.' It's probably the only menschy Jewish thing he's done."
Whatever the truth, Mark and Andrew have acted to cut off their parents from their lives in every way possible. The boys have refused to see their father in prison or to speak to their mother. All their communications are through lawyers. Bernie wrote to his grandchildren, but Mark would not allow his children from his first or second marriage to visit their grandfather in prison or their grandmother in her apartment. They have exchanged letters with their grandfather in prison, but they want to change their last name to avoid the shame associated with anything Madoff.
Ruth is livid with both of her sons. She found their behavior "unconscionable" and "outrageous."