JTA: The Global News Service of the Jewish People

JTA: Federation in D.C. lost investments with Madoff

By Jacob Berkman · December 15, 2008

JTA's Eric Fingerhut broke this:

The endowment fund of the Jewish Federation of Greater Washington had more than $10 million invested with Bernard Madoff's scam fund.

In a letter to donors, The United Jewish Endowment Fund said the Madoff investments represented less than the 10 percent maximum for any single fund manager in the fund's active portfolio, in keeping with the organization's investment policy. The endowment fund's holdings as of Nov. 30 -- including the Madoff-invested funds -- had totaled $125 million, meaning Madoff's firm managed approximately 8 percent.

The money under Madoff management came from a variety of UJEF funds, including the federation's general endowment, donor-advised funds and funds the Greater Washington federation manages as a custodian for other Washington-area Jewish institutions.

The letter says the fund has "engaged legal counsel" to "pursue recovery" of the lost funds. It adds that "at this time, we do not know the status of the Federation’s investment" but would continue to communicate with "all of the Federation's stakeholders."

Madoff, the founder of Bernard L. Madoff Investment Securities LLC, was arrested Dec. 11 after admitting to his board that a hedge fund he ran was essentially a $50 billion Ponzi scheme.