Madoff�s Wife Declares Palm Beach Home Main Residence

[banca rotta]

March 17, 2009

Bernard Madoff’s wife has declared her Palm Beach, Florida, estate as her primary residence, a move that may shield the $9.4 million home from creditors.

Ruth Madoff applied for and received a homestead exemption for property taxes, said Dorothy Jacks, assistant property appraiser for Palm Beach County. The Florida constitution protects homeowners who have obtained the exemption and seizing the property may be difficult, said Danaya Wright, a law professor at the University of Florida in Gainesville.

The U.S. government said this week it plans to seize assets including the Madoffs’ $7 million Manhattan apartment and the Palm Beach home. Bernard Madoff, 70, was jailed March 12 after admitting to masterminding the biggest Ponzi scheme in history. The exemption Ruth Madoff received may be an effort to protect the property from creditors, said Jack McCabe, founder of McCabe Research & Consulting LLC in Deerfield Beach, Florida.

“The two big drawing cards to Florida were sunshine and affordability,” McCabe said. “Now it’s for sunshine and the protection of your primary mansion.”

The exemption will entitle Ruth Madoff to a 2009 tax reduction since it cuts the county’s appraisal of the property by $50,000, said Jacks. Ruth Madoff paid $157,298 in property taxes on the Palm Beach home in 2008, according to county records.

She applied for the tax exemption Sept. 18 and received it Jan. 12, according to the appraiser’s office.

Home Value Climbs

Ruth Madoff hasn’t been accused of wrongdoing. Attorneys Peter Chavkin, who represents Ruth Madoff, and Dan Horwitz, Bernard Madoff’s lawyer, didn’t return telephone messages seeking comment.

The appraised value of the 8,753-square-foot property at 410 North Lake Way rose 27 percent to $9.4 million in 2008 from $7.4 million in 2007, according to Palm Beach County records. Ruth Madoff bought the property in 1994 for $3.8 million, according to county records.

The median sales price for a single-family home in Palm Beach climbed 11 percent in 2008 to $3.9 million, according to the Evans Report, published by Palm Beach law firm Leslie Robert Evans & Associates P.A.

Homeowners can prove Florida residency through a number of means, including voter registration and a Florida driver’s license, Jacks said. To receive the exemption, they have to sign a sworn statement attesting that the home they want the exemption for is their primary residence, Jacks said.

Ruth Madoff’s exemption was reported earlier by the Palm Beach Post newspaper.



Source:
Bloomberg.com
By Brian Louis

http://www.bloomberg.com/apps/news?pid=20601170&refer=special_report&sid=aEfSsWCagyK0

[banca rotta]

This will be a good one for the high priced attorneys. Even though she probably owned the home for many years this may not fly if the creditors force her into an involuntary bankruptcy.

It looks as if it wasn't her primary residence until recently which is why any bk proceeding will supersede Fla's homestead exemption.

This should have been her primary residence for 3 years.

I do hope the feds take it from her.

[fltoo]

Everything they acquired was through fraudulent activities so hopefully they lose everything.

Either she was very stupid or just as crooked as her husband.

[JRScott]

They should seize all assets of the Madoff family, his wife, his sons, his brother, etc. They ran a fraudulent business and they all were in on it, there is no way they could have worked for 20 years under Bernie and not known it was a fraud.

So what they do is charge her with fraud and seize the home anyway most likely. It appears to have been a calculated move by the Madoff's.

[blindsided]

Everything they acquired was through fraudulent activities so hopefully they lose everything. Either she was very stupid or just as crooked as her husband.

Actually, there were two businesses. The company Madoff Securities seems to have been at least mostly legitimate. It's Madoff Investments, the private firm he ran on another floor of the same building, that sheltered the Ponzi scheme.

They should seize all assets of the Madoff family, his wife, his sons, his brother, etc. They ran a fraudulent business and they all were in on it, there is no way they could have worked for 20 years under Bernie and not known it was a fraud.

The family members worked for the legit side. What Madoff tried to do by pleading guilty is distance them from his activities. At least so far, all we have is suspicion like yours that their intimacy with him would have made it impossible for them not to know, and the moving of assets in the days before the scheme was uncovered.

Just to keep things straight. The scale of the scheme may mean that satisfying the victims will only be possible by wiping out all the family members, but it's not yet clear that they're guilty in the criminal sense.

[JRScott]

Actually, there were two businesses. The company Madoff Securities seems to have been at least mostly legitimate. It's Madoff Investments, the private firm he ran on another floor of the same building, that sheltered the Ponzi scheme.



The family members worked for the legit side. What Madoff tried to do by pleading guilty is distance them from his activities. At least so far, all we have is suspicion like yours that their intimacy with him would have made it impossible for them not to know, and the moving of assets in the days before the scheme was uncovered.

Just to keep things straight. The scale of the scheme may mean that satisfying the victims will only be possible by wiping out all the family members, but it's not yet clear that they're guilty in the criminal sense.

I'm sorry but you can't have a legit side and an illegit side, such an argument to me is illogical. They were all in on it. I mean seriously in her role as book keeper for 20 years what did she do that justifies such assets as she has?

It was all a shame, the fact she move her residence to FL just before it all blew up, the fact she withdrew millions of dollars including 10 million the day before, etc. If it was a bankruptcy case the trustee would get them for fraud because that's what they are doing....

[2Bshinyandnew]

I'm sorry but you can't have a legit side and an illegit side, such an argument to me is illogical. They were all in on it. I mean seriously in her role as book keeper for 20 years what did she do that justifies such assets as she has?

It was all a shame, the fact she move her residence to FL just before it all blew up, the fact she withdrew millions of dollars including 10 million the day before, etc. If it was a bankruptcy case the trustee would get them for fraud because that's what they are doing....

Agreed. BUT, in order to set aside the homestead protection established for the Florida home using Civil Asset Forfeiture laws, they must prove that the proceeds used to purchase the property were a result of illegal activities, and/or that the asset/property was used in connection (the site of) a crime. The fact that Mrs. Madoff just recently applied for the homestead exemption on the property isn't nearly as important as where the money came from to buy the property and whether any illegal business was conducted at the property. The recent homestead application may support an allegation of fraud, but on its own, the recent application likely would not be enough to seize the property. Just my humble take on this

We'll see how it all plays out! Do I want justice? Of course. My retired uncle and his wife lost every penny of their retirement to Bernie Madoff. Everything they worked 6 years to accumulate is gone.

[momxx5]

This will be all very interesting for me to watch.
I worked in banking on Worth Ave within view of the ocean and Saks, in Palm Beach. I left overe 15 yrs ago when I had my first born.

The whole culture down there is different. Most of the residents seem to think that the rules of the rest of the world do not apply to them.
And then there were some of the most kind generous people you would ever meet.

It was when the lines started to blur between the mix of old money(where hard work and honest rang true) and the new money(where the money was made fast and questionable) that DH & I would often wonder when the indictments would be handed out. (and that was well over 16-18 yrs ago)

The list of Madoff's victims include some of my old customers. However, our bank catered to most of the older PB families so sadly most of my customers have died.

[justbroke]

The whole culture down there is different. Most of the residents seem to think that the rules of the rest of the world do not apply to them.

That's because it's old money. That's the old Gilded Age Era of the Astors, Vanderbilts, Belmonts, and others. They didn't even like Donald Trump because he was nouveau riche.

And then there were some of the most kind generous people you would ever meet.

I agree. The aforementioned estates have left hundreds of millions of dollars in real estate to charity!

[banca rotta]

Agreed. BUT, in order to set aside the homestead protection established for the Florida home using Civil Asset Forfeiture laws, they must prove that the proceeds used to purchase the property were a result of illegal activities, and/or that the asset/property was used in connection (the site of) a crime. The fact that Mrs. Madoff just recently applied for the homestead exemption on the property isn't nearly as important as where the money came from to buy the property and whether any illegal business was conducted at the property. The recent homestead application may support an allegation of fraud, but on its own, the recent application likely would not be enough to seize the property. Just my humble take on this

We'll see how it all plays out! Do I want justice? Of course. My retired uncle and his wife lost every penny of their retirement to Bernie Madoff. Everything they worked 6 years to accumulate is gone.

I'm just wondering if all the creidtors force her into an involuntary bankruptcy they can take the house and leave here with the 125k federal exemption.

I'm not sure how it works, does the home have to belong to her for just over 3 years or does it have to be her primary residence for the 3 plus years?

If it's the latter then she can kiss it goodbye under the federal guidelines regardless of the fla exemption.

[BigJohn]

Gee, I thought the largest and longest run ponzi skeme in history is Social Security and Medicare?

[JRScott]

Gee, I thought the largest and longest run ponzi skeme in history is Social Security and Medicare?

True

[banca rotta]

Gee, I thought the largest and longest run ponzi skeme in history is Social Security and Medicare?

It is!

[2Bshinyandnew]

I'm just wondering if all the creidtors force her into an involuntary bankruptcy they can take the house and leave here with the 125k federal exemption.

I'm not sure how it works, does the home have to belong to her for just over 3 years or does it have to be her primary residence for the 3 plus years?

If it's the latter then she can kiss it goodbye under the federal guidelines regardless of the fla exemption.

Outside of Bankruptcy there is no time limit, once Mrs. Madoff started living in the Florida residence full time, started getting bills there, registered to vote, that is when a person is considered a full time resident. You need not be a full time resident for any length of time to use Florida's homestead protection outside of bankruptcy. Once that application to the Tax Collector is accepted, you are covered.

Within a Bankruptcy, the home must have been occupied for 40 months prior to Bankruptcy. I imagine that clock is ticking for Mrs. Madoff. If the homestead exemption was granted in January 09 (or maybe it is retroactive to date of application?) if she can hold out and not file bankruptcy for the next 3 or so years....

Will be interesting to see how it plays out.


See:

http://www.alperlaw.com/constitutional_protection.html