Money Manager Stanley Chais, Linked to Bernard Madoff, Dies at 84
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Sep 27th 2010 1:16PM
Updated Sep 27th 2010 7:11PM
On Sunday, Los Angeles-based money manager Stanley Chais died. He was 84.
At the time of his death, Chais was under investigation for his involvement with Bernard Madoff. The manager of three investment funds that channeled money to the notorious Ponzi schemer, Chais told investors -- including director Stephen Spielberg -- that the impressive returns of up to 25% were the result of careful hedging and sage stock picks. Chais also invested his own funds with Madoff, and received even more astounding dividends: According to a lawsuit filed by Madoff bankruptcy trustee Irving Picard, Chais' personal return on investment averaged 40% and sometimes soared to 300%.
Facing civil fraud charges from the Securities and Exchange Commission, a lawsuit from California Attorney General Jerry Brown, and the Picard lawsuit, Chais claimed that he was unaware that Madoff's business was a house of cards. However, Picard's lawsuit alleged that Chais' family had withdrawn $1 billion from their Madoff account between 1995 and 2008, making it hard for the money man to paint himself as a victim. In response to his SEC charges, Chais asserted that they should be dropped, as the regulatory agency had given credence to Madoff through its own inefficiency and failure to capture him.
Chais is the second prominent Madoff associate to die since the notorious fraudster was sentenced to 150 years in prison. The first, Jeffry Picower, drowned in his Palm Beach, Florida home on Oct. 26, 2009, under suspicious circumstances. A Madoff investor who made an estimated $7.2 billion off his investments in the Ponzi scheme, Pickower was on the 2009 Forbes 400 list. At the same time, he was also under investigation by federal prosecutors in New York. Aged 67, Pickower suffered from Parkinson's disease and assorted heart ailments, and was found by his wife at the bottom of his pool.
The circumstances of Chais' death were far less suspicious. Suffering from a rare blood disease, he moved to New York from Los Angeles to receive medical treatment. According to his wife, he was receiving regular dialysis treatments at the time of his death.
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CORRECTION: The individual depicted in the photograph erroneously accompanying this article earlier was not Stanley Chais.
At the time of his death, Chais was under investigation for his involvement with Bernard Madoff. The manager of three investment funds that channeled money to the notorious Ponzi schemer, Chais told investors -- including director Stephen Spielberg -- that the impressive returns of up to 25% were the result of careful hedging and sage stock picks. Chais also invested his own funds with Madoff, and received even more astounding dividends: According to a lawsuit filed by Madoff bankruptcy trustee Irving Picard, Chais' personal return on investment averaged 40% and sometimes soared to 300%.
Facing civil fraud charges from the Securities and Exchange Commission, a lawsuit from California Attorney General Jerry Brown, and the Picard lawsuit, Chais claimed that he was unaware that Madoff's business was a house of cards. However, Picard's lawsuit alleged that Chais' family had withdrawn $1 billion from their Madoff account between 1995 and 2008, making it hard for the money man to paint himself as a victim. In response to his SEC charges, Chais asserted that they should be dropped, as the regulatory agency had given credence to Madoff through its own inefficiency and failure to capture him.
The circumstances of Chais' death were far less suspicious. Suffering from a rare blood disease, he moved to New York from Los Angeles to receive medical treatment. According to his wife, he was receiving regular dialysis treatments at the time of his death.
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CORRECTION: The individual depicted in the photograph erroneously accompanying this article earlier was not Stanley Chais.
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