A stack of Internet research on Bernard Madoff, who is accused of $50 billion in investment fraud, rests on a table in front of Marcia and Martin Ellis as they talk Monday at the Bangor Daily News about losing their life savings. While OK with having their names published, the Ellises, who retired to the Bangor area six years ago, requested that they not be clearly identifiable in any photo to protect their privacy. Buy Photo
BANGOR, Maine — After years in New York and Boston, Martin and Marcia Ellis moved to New Hampshire and then to the Bangor area six years ago, just like many retirees in search of a more relaxed lifestyle.
On Dec. 12, the couple’s lives became a lot less relaxed when they found out they lost all their savings in New York investor Bernard Madoff’s alleged $50 billion Ponzi scheme.
Martin Ellis’ daughter called that day to tell the couple the upsetting news.
“It was terrible,” Marcia Ellis, 57, recalled Monday in an interview at the Bangor Daily News. “We couldn’t believe it. Marty said, ‘We’re wiped out.’ We still can’t really grasp it.”
Unlike many who have been burned in the scandal, the Ellises weren’t fabulously wealthy — the few hundred thousand dollars they lost were Martin Ellis’ invested retirement savings from his years working at NBC in New York City.
“How can little people involved in such a big scandal survive?” the couple wrote in a letter sent to Gov. John Baldacci and Maine’s congressional delegation. In the letter, they asked for help with their efforts to retrieve at least part of their money.
It seems as if “little people” investors are the exception rather than the rule in the unfolding Madoff scandal. Since it broke in mid-December, it has become clear that to get in with Madoff, a would-be investor needed lots of money — or connections.
Ties to Brooklyn
The Ellises’ connection to Madoff goes back more than 40 years, to Brooklyn, N.Y.
At first it seemed like a lucky coincidence.
Martin Ellis’ parents lived just down the street from Ruth Madoff’s parents in Brooklyn. When Ruth married her high school sweetheart, Bernard Madoff, that neighborhood connection meant that many in the Ellis family became early investors with him in the late 1960s.
“Years ago, I talked to my brother-in-law about putting money in something other than Madoff,” Martin Ellis, 69, remembered. “He said, ‘What do you need something other than Madoff for?’”
The brother-in-law was in good company. According to a National Public Radio report, even former New York Gov. Eliot Spitzer invested with Madoff — and Spitzer was known as the “Sheriff of Wall Street” when he was New York attorney general.
“The party was going,” Marcia Ellis said. “Everybody was making money. Everybody turned their heads the other way.”
So the Ellises were among those who watched their life savings grow each month, thanks to Madoff’s apparent Midas touch — even as the rest of the financial world seemed to go into free fall last autumn.
Then, disaster. When Madoff was charged by federal prosecutors on Dec. 11 with running an apparent $50 billion Ponzi scheme, it became painfully clear to the Ellis family that the coincidence was unlucky after all.
“[Marty’s] entire family is wiped out,” Marcia Ellis said Monday. “It’s a tragedy.”
The couple now has only Martin Ellis’ pension, Social Security and a home equity loan. They hope that the Securities Investor Protection Corp., a nonprofit organization created by the U.S. Congress to aid customers of fraudulent brokers, might cover some of their losses.
But they aren’t counting on it.
Marcia Ellis, 57, a retired formula specialist for Pepsico, wears bright blue glasses — “$2 from Marden’s” — and seems surprisingly relaxed just weeks after her world changed.
During the interview Monday, she clutched a folder full of information about the victims and perpetrators of what’s being called the world’s biggest financial fraud ever.
“I do all of this research because I can’t sleep,” Marcia Ellis said.
Later Monday, she registered for a Bucksport adult education computer class so that she can look for a job as a secretary. The tough economy and job market worry her, but she knows she’d feel better if she were working.
“You’ve got to stay positive,” Marcia Ellis said.
Six lessons learned
Many of the victims of Madoff’s alleged scheme have famous names or lots of money. Steven Spielberg’s charitable foundation was stung. So was Liliane Bettencourt, the L’Oreal cosmetics heiress.
The Ellises say that they don’t have much in common with these people — except their unfortunate connection to Madoff.
“I want to bust this idea of this just affecting rich people in Palm Beach,” Marcia Ellis said.
“We’re not billionaires,” added her husband.
Lessons the poorer-but-wiser couple has learned could come in handy for everyone, they say.
Marcia Ellis found six tips for investors on the Internet that seem particularly pertinent:
• Limit any financial relationships with friends and family.
“Well, we blew that one,” she said.
• Don’t allow people to sway you into investments you don’t understand.
“There was no need to sway. All the families knew each other,” she said.
• Know where your money is.
“We kept strict accounts and kept every check and statement we got each month, which turned out to be fakes,” she said. “The Feds are still trying to unravel what was truthful and what was not.”
• Keep up with how your investments are doing.
• Always diversify.
“We did have all our eggs in one basket, with terrible consequences, and we know better now,” Marcia Ellis said.
• Ask first and trust later — know what your risk is.
Although these lessons are a little too late to help the Ellises, they are striving to limit the other kinds of damage that can accompany financial catastrophe. When the two talk together, there’s no simmering undercurrent of tension, and that’s intentional, they say.
“We’re very calm because we decided we’d stay calm,” Marcia Ellis said. “We weren’t going to fight with each other, or blame each other.”
This positive attitude seems even more amazing when they reveal that their suddenly modest circumstances mean that they haven’t gone shopping for anything other than essentials since Dec. 12.
That’s what happens when you’re swept up in what Marcia Ellis is calling “the crime of the century.”
“It’s all like we were a part of a house of cards,” she said. “And all of a sudden, it fell — poof.”
On 1/6/09 at 3:53 AM,
fledgeling wrote:
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Wow, I have never been fortunate enough to have money to invest, but have known the trauma of losing it all. I feel for the Ellis family, and admire their positive attitude for the future. I think they will be surprised by how little one needs really, to be happy and prosper. Best of luck to them!
On 1/6/09 at 4:27 AM,
lalizz wrote:
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Dear former neighbors: so sad for you. You can always move back to the Point. We'll take care of you....
'
On 1/6/09 at 5:42 AM,
WRofGlenburn wrote:
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Lesson seven: If the return on your investment seems to good to be true...it probably is!
On 1/6/09 at 6:06 AM,
augustagoverned wrote:
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When it seems to good to be true ...........................................
On 1/6/09 at 6:07 AM,
JWBooth wrote:
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And the authorities want us to believe Madoff was acting alone -- like Oswald.
On 1/6/09 at 6:33 AM,
SammieJ wrote:
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Very few media stories of the fraud perpetrated by former Nasdaq chairman Madoff mentions the heavy financial support that Madoff has donated to the Democrat Party. Campaign contributions by Madoff show many thousands of dollars going to Democrat candidates and causes. Including $100,000 to the Democratic Senatorial Campaign, thousands to Charles Rangel (D, NY), Charles Schumer (D, NY), and $6,000 to the Securities Industry and Financial Markets Association. Madoff also gave generously to Senator Frank Lautenberg (D, NJ) who runs a charitable foundation that invested with Madoff.
With the money that Madoff spread around in contributions is it really surprising that his actions went ignored by regulatory agencies?
In any case, the media seems wholly uninterested in the fact that Madoff is a big Democrat contributor. When you invest with a crooked donkey, you get kicked in the face.
On 1/6/09 at 6:45 AM,
anne_of_mdi wrote:
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Yes I would be curious to see if those contributions were ever collected. There's a big difference between a pledge and a contribution. Obviously this Madoff talked a big game, but talkin' ain't walkin.'
On 1/6/09 at 6:55 AM,
sieram wrote:
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A classic example of american greed...make money without work. There are very few Mainers who can afford "hundreds of thousands of dollars" to invest with Madoff or any other Wall St paper pusher. People like this are don't have a problem, they are the problem ! And, directly responsible for the mess for he mess this country is in.
On 1/6/09 at 7:26 AM,
mainemcq6 wrote:
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Everyone seems to have forgotten Marthas Stewart and how the government went after her. It is shameful that this thief is in his penthouse after fleecing many people of their life savings. Another example of why America is on it's way out as a world influence. We are an influence all right, but in the wrong way!
On 1/6/09 at 7:37 AM,
MrBeane wrote:
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sieram, plenty of Mainers have more than a few hundred thousand dollars invested for retirement. I am not rich, but plan on having several million dollars invested when I retire. I am not the problem - I am responsible with my money. Each year between me and my employer I invest 20% of my salary into a retirement fund (which has been hit pretty hard in the last year, but I'm 29 right now, so this is a good time for me to be investing). I make some sacrifices - I live comfortable but don't spend a lot of money on "toys" I don't need (like snowmobiles or a boat - things that a lot of "poorer" people than me seem to easily afford). If you "paid yourself first" any average worker can easily have several hundred thousand in the bank by the time they are middle aged.
On 1/6/09 at 8:04 AM,
Marrin wrote:
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While I do feel badly for this family, I can't help wondering what it would be like to have "a few hundred thousand dollars" that you could hand over to someone......for anything!! Both my husband & I are hardworking people who struggle to pay our bills, taxes etc. on time, but if I HAD those few hundred thousand dollars, I'd keep them where I knew exactly where they were. I realize that some 'regular' people were affected by Madoff's scheme, but I can't help thinking that they were taking a risk and had to know that. That is no different than any investment. The fact that he's a crook shouldn't mean that they should get their money back anymore than those who invested in any of the recently failed Wall Street investments. If you are willing to take a risk with your money, there is always the chance that it goes sour. It is purely a product of powerful greed!
How many of you regular hardworking Mainers have " a few hundred thousand dollars" laying around. The fact that they refer to themselves as not "fabulously wealthy", excuse me but that is a totally relative term. And the fact that she bought her glasses at Marden's, well join the rest of us who have to make do with what we have and not because we have lost hundreds of thousands to a scheme.
It's too bad that these folks will have to get by with SS and retirement....................just like so many of their neighbors!!!!!! If you play, you have to realize you could lose it all.
On 1/6/09 at 8:10 AM,
anne_of_mdi wrote:
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Wow, I am really surprised to see complaints about people having a couple hundred grand to invest when, only a little more than a month ago, so many commenters here were up in arms about the possibility of President-elect Obama increasing taxes on quarter-millionaires.
On 1/6/09 at 8:24 AM,
realhockeymom wrote:
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So do you feel that people shouldn't look ahead and save and invest over their entire lifetime, including saving money from the sale of a family home, which is what these folks did? That all "regular hardworking Mainers" just spend everything they have and don't both to look ahead? Because that's what these folks did and, from your comments, what you can't bother to do. These folks worked hard all their lives and invested with a family friend--has nothing to do with greed and everything to do with being thrifty and foresighted, and trusting someone you've known all your life. What an unpleasant short-sighted compassionless person you must be, Marrin.
On 1/6/09 at 8:25 AM,
boogyman wrote:
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sieram, you sound like you're jealous. These people invested their money for their own retirement, and like many people much smarter then them, they were duped. I suppose you think it's more American to spend every penny you earn so you can suck off the tit of government when you retire.
I know many, many people much younger than this couple that have managed to save a few hunred thousand dollars or more. They don't have houses they can't afford, they don't buy a new car every three years, many of them only have basic cable, dial up internet, don't eat out every week, go to work every day. In other words, they make good decisions and are self sufficient. Notice how these people did not run to the welfare office as their first resource, they are making plans to take care of themselves. Now theres a novelty.
On 1/6/09 at 8:30 AM,
LincolnMOM wrote:
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I would never trust anyone with my money... other than my husband. Not like I have a whole lot to entrust in him. :) Hey but we are happy!!!
On 1/6/09 at 8:41 AM,
SteveyDee wrote:
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I guess some people have never heard of a 401K?????????
On 1/6/09 at 8:45 AM,
tightlines wrote:
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These folks have only themselves to blame. Their loss is unfortunate. As they blithley rode the Madoff train I'm sure they had no thought of sharing any of their "returns" with the rest of us. I certainly would expect that they be consistent and not expect to share their losses with the rest of us either.
On 1/6/09 at 9:00 AM,
Lizabeth wrote:
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Good luck to these people. We have lived in Maine all our lives and worked here in the State for 40 years and are small investors. We have lost half our investments in a regular investment firm in Maine. We weren't looking for some get rich scheme. If these people can get money out of our State and the Govenor please add our name to the list and send us a check.
On 1/6/09 at 9:01 AM,
Elizabethann wrote:
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I don't like the stock market. I don't trust it. When Bill Clinton told people not to depend on Social Security for retirement but to invest in the stock market, I kind of figured this was going to happen. It's all a big poker game. You have to put alot of trust into these people, and frankly I don't trust them. Most of them should not be trusted. Between crooked politicians, lobbyists, and greedy corporations most of us don't have much of a chance. Not anymore.
On 1/6/09 at 9:59 AM,
choppahdave wrote:
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I invested in a lawnmower so I could experience the 'trickle-down' effect. Now it's trickled down allright. Some of these stock-market people are even shoveling their own snow.
On 1/6/09 at 10:55 AM,
jaguarsky wrote:
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Yes, it is a poker game. And one with a few extra aces at that. I hope that THIS TIME America learns a lesson. After the previous big crash, circa '29, the gov'mnt enacted regulatory laws to ensure that it never happened again; this betting with other people's money. But along came the 90's and WOW, look at all the money that can be made by artificially inflating the market. And of course bankers are all honest and in business for the greater good, so we really don't need those pesky little regulations anymore. We are an enlightened society. Yes?
Oops, got that one wrong!
I don't hold out much hope that any investors, Madoffs victims or others will ever see much of their purloined funds returned. It happened to Maine teacher's a number or years ago, and they very little back, because the slimy little investment worm had placed all of his assets in another family member's name. Same game, bigger table this time.
I feel very bad for those who like the folks in this story lost more than they could afford. But, I have always been told that the first rule of gambing is to only bet what you can afford to lose. And for those of you who are disparaging this couple, have a little compassion. Yes, they had a pretty substancial nest egg to invest, far more than most Mainer's will ever have. But they, like so many now, seem ill prepared to face a life of poverty, not like the bunch of us who have had years of practice survivning on SS, or SSI. It is, for us anyway, a good time to be poor. The recession/depression touches us little. WE already know how to cope.
Here are a few tips for you newly disenfranchised: mac-n-cheese, beans and rice, mark-down bins, food pantries and second hand stores. And for goodness sake, don't abandon your animals because times are tough. Cats and dogs can survive quit nicely on rice and boiled pork liver, which you can buy with your food stamps. Good luck and may the Creator bless and keep you.
On 1/6/09 at 12:17 PM,
jaguarsky wrote:
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Sorry, I need to correct and earlier post. In my rant, it sounded as tho a scam had been perpetrated on "Maine teachers" in a general sort of way, it was not a scam directed specifically at the teachers, but a number of them, including some in my family we conned along with many other hard working Mainer's who had hoped to make enough to ease their retirement. I will try to edit my soap box ravings more closely from now on.
On 1/6/09 at 1:52 PM,
bidoux wrote:
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SammieJ:::There he goes injecting politics into a very sad tragedy. Wasn't there a bunch of republicans sent to jail during Bush's time in office? Isn't Cheaney mixed up with the company that screwed the American people with their overpricing on materials for the war.
On 1/6/09 at 2:14 PM,
CeeBlue wrote:
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1880---1929--2008 ----''investors'' of all sorts we're wiped out;
Is there not some adage to the effect; those who do not learn from history are bound to repeat it.?
This is an unfortunate story--but I'm going to [at least] sit down and have a shot of 'Ol Hoar's Breath'/coffee with anyone I'm going to send money to and trust to just go to the mailbox for returns.
Did anyone ever see a less than very well to-do Wall S. 'moneyman' Guess who's $ they're spending.
Think Land.
On 1/6/09 at 2:43 PM,
gw2kpro wrote:
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So basically, in this scheme, Madoff:
-Didn't actually invest the money investors gave him. He took money from new investors and paid his existing investors with it.
-Eventually people wanted their money back they had paid Madoff and he didn't have it because he had given it to everyone else
This is no different than social security. The check will come due one day. For your own good, please do not rely on social security for your retirement, all that money you have put into the system has not been invested anywhere, it has already been given away to other people. Any benefits you receive in the future will have to be collected from future generations.
On 1/6/09 at 2:44 PM,
ironwolf56 wrote:
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People who have lived in Maine six years after retiring here are not what I'd call "Mainers"
On 1/6/09 at 3:24 PM,
thekingofmaine wrote:
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as soon as you make a s-load of money off an investment... I'd pull out
On 1/6/09 at 4:04 PM,
Elizabethann wrote:
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Jaguarsky...I like you..have lived that way at times. Husband had lost his job and four in college. Not that we were ever people who wasted anything but we tightened even more. Imagine if the economy had to depend on people like us? Good learning lesson for all of us.
On 1/6/09 at 4:13 PM,
Katofbangor wrote:
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You are not a Mainer if your were not born here. You may reside here, you may taxes here,etc but unless you were born here you are not and never will be a Mainer!
On 1/6/09 at 4:13 PM,
Katofbangor wrote:
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You are not a Mainer if your were not born here. You may reside here, you may taxes here,etc but unless you were born here you are not and never will be a Mainer!
On 1/6/09 at 4:13 PM,
Katofbangor wrote:
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You are not a Mainer if your were not born here. You may reside here, you may taxes here,etc but unless you were born here you are not and never will be a Mainer!
On 1/6/09 at 4:35 PM,
boogyman wrote:
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gw2kpro: good comparison. Social Security is just a government sanctioned pyramid scheme.
On 1/6/09 at 7:34 PM,
Marrin wrote:
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To realhockeymom..............what I said is if you can't afford to gamble the money, perhaps you should rethink what you are investing in. As far as your comments regarding Mainers spending everything they have and not looking ahead.........well, excuse me but we do not spend everything we have with no thought of the future, how dare you imply such a thing. My husband and I own a small family business and it takes about all we have to keep things running, paying taxes, small payroll and insurances. We struggle sometimes especially in this economy, but I wouldn't hand over a substantial chunk of our money if I knew that we could not afford to risk it.
I feel your assessment of me as an unpleasant, short-sighted and compassionless person is a very personal attack and I resent it. We have no luxuries, but own our comfortable home as a product of hard work, have paid for our children's education as well as our nephew's and I do not apologize for saying that these folks will have to be thrifty (in a new way) and make do like the rest of us do on a daily basis. Yes, I shop at Marden's, thrift stores and we generally eat what's on sale at the grocery stores. The fact that we have not had hundreds of thousands of dollars to invest with a family friend is one that I do not regret. We have what we need and have nobody to blame but ourselves if we find our check book a little short some months.
Hopefully, you were just having a nasty morning!
On 1/6/09 at 8:18 PM,
marsue wrote:
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I am truly saddened and dismayed, but not surpised, by the content and twisted logic in many of the comments written by "Mainers" in response to this article. The Ellis' came forward to share their unfortunate experience to hopefully help someone else and should be thanked for their thoughtfulness and caring. They were hardworking, saved their money, invested, with a reputable firm, and like most of us hoped to have a comfortable retirement. They then became VICTIMS.
We moved here 5 years ago after falling in love with the beauty of the state, not knowing the true ugliness of many of the citizens, a bunch of short-sighted, cigarette smoking, Allen's Coffee Brandy drinking hypocrites. Many of you cannot get out of your own way unless it is to cash your welfare check or to get some other government handout. Many of the comments are ignorant, without thought or compassion, and hurtful. Shame on you.
Yes, we are from away and cannot wait to once again be far away from Maine. Perhaps the Ellis' would like to come with us.
Marsue
On 1/6/09 at 10:39 PM,
Richard37 wrote:
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BOO HOO! I guess rich out of staters arent as smart as they think they are.your only in your 50's,go get jobs and work till 72 like the rest of us are gonna have to do.Youll notice a big pay decrease from Pepsi and NBC,to being a clerk or typist.all the best.......................good luck.
On 1/7/09 at 6:54 AM,
Marrin wrote:
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Marsue..........by all means, don't let the bridge (that would be the Maine / New Hampshire one) fly up and hit you in the butt when you leave Maine. For you to make the absurd statement that we all are on welfare, drink Allen's Coffee Brandy and smoke cigarette tells me that you are "from away". Many of you who come to our beautiful state on holiday feel that you want to live here and experience the Maine life-style.........okay, you got it! Yes, it's true, there are those who fit your description, but the vast majority are very honest, hard working good people with a great deal of pride. I've never gotten welfare, smoked or drank coffee brandy, even though I was born and raised here. Stop making those assumptions and leave!
On 1/7/09 at 10:39 AM,
SiddFinch wrote:
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"Yes I would be curious to see if those contributions were ever collected. There's a big difference between a pledge and a contribution"
No need to be curious. Just go to OpenSecrets.org. You will find them there.
On 1/7/09 at 10:57 AM,
anne_of_mdi wrote:
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I took your advice, SiddFinch, and checked out Open Secrets. But I didn't find the big numbers quoted by SammieJ. It showed $2,300 in '08 to Merkley, Jeff (D), $25k in '08 and in '07 to Democratic Senatorial Campaign Cmte, and $2,300 in '07 to Frank Lautenberg (D). That's only $54,600 over two years. Where did you guys get your 6-figure contributions info?
On 1/20/09 at 12:10 AM,
snobabe wrote:
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if something seems to good to be true,then run as fast as u can away from it, cause it's real good all rite,really good at stealing your money.i think madoff should spend a day in jail for every dollar he cheated people out of,i am always watching where my money goes u have to now a days,cause money is getting harder to come by as far as people getting ripped off it's thier fault, it would not hurt to ask question's and envolve lawyer's before signing paper's or investing.
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