Cons Targeting Jews: First Madoff, Now Stanford
Nanes and his Jewish sales force heavily advertised Stanford products in community publications.
He also dished out Stanford money as a corporate sponsor to every significant Jewish cultural event, said Renee Shabot, director of Tribuna, an organization that acts as a liaison between the Jewish community and the non-Jewish world. Stanford sponsored sports teams, arts, and Kadima’s huge annual fundraiser:
“People got used to seeing the name, seeing their faces and so they trusted them,” Shabot said.
Nanes, who is laying low somewhere in the Houston area, doesn’t deny that he went after Jewish clientele but he insists he believed at the time the products he was hawking were legitimate.
According to Nanes’ Houston lawyer, Charles Parker, Stanford hired the 41-year-old MBA about ten years ago to take charge of opening up Mexico — and more recently, South America — to sales of financial products. Neither U.S. nor Mexican authorities have accused Nanes of any wrongdoing, although serious alleged misdeeds are detailed at length in the San Antonio class action lawsuit and in a new book published in Mexico called The Paper Empire by Mexican journalist Gabriel Bauducco.
Parker said his client “never suspected anything was wrong,” adding that Nanes and his wife “lost several million dollars, his parents even more.”
Believing that Stanford products were legitimate, Nanes naturally decided to market them to the Jewish community because “that’s who he knew. That was the wealthiest community,” Parker said. It made sense for Nanes to recruit other Jews from the communities as sales officers because they also had extensive local connections there too, Parker said.
“And word spread, and people were happy,” Parker continued. “They got their return and passed it on to others. Everybody was pretty happy until everything went to hell in a hand basket.”
To be sure, many more non-Jews than Jews lost money in the Stanford theft. All told, regulators believe Stanford’s CD sales operations sucked in billions from about 30,000 victims in Latin America, Europe, and the U.S.
But more than half of all the estimated 4,000 victims in Mexico were Jews who lost some half a billion dollars. That kind of number packs an outsized wallop for such a small, defined community, according to San Antonio lawyer Ed Snyder.
Snyder is one of several Texas and New York attorneys representing well over 1,500 Mexican and Venezuelan victims in various lawsuits against Stanford, a number that is growing fast.
Snyder recounted how he first became aware of this one victimized demographic. On his first trip to sign up Mexican clients in February, he was surprised to encounter furious Hasidic Jews wearing yarmulkes and other religious attire, speaking Yiddish before switching to Spanish. Subsequent trips to sign up clients and to hear their stories more than confirmed Snyder’s initial impression:
“My perception is that the Jewish community in Mexico City, for various reasons, has been heavily impacted by the Stanford disaster,” Snyder said. “I think what you have here is a situation where that community was specifically targeted.”
A similar story is unfurling in Venezuela, where an even more insular Jewish community of 14,000 reports similar misfortunes from investing in Stanford, also the result of the company’s strategy to hire trusted Jewish salespeople from the community.
Chief Rabbi Penchas Brener, who represents Caracas’ largest synagogue, acknowledged that he lost $50,000 to Stanford from the endowment of an important local foundation he heads. That’s a substantial sum in a country where per capita income is less than a third of that in the U.S.
“I don’t know how hard it hit the community, but I know it hit,” Brener told me in August.
Brener said he felt almost no wariness about reaching out to one of Stanford’s “account executives,” a local Jewish man whose family he’d known for decades, to invest his foundation’s $50,000 reserve account. “I didn’t pay too much attention to the credentials,” Brener said. “They were Venezuelan Jews. They worked for a bank. He didn’t have to convince me; I called him. This was made easier, so to speak, by the fact that he was Jewish.”
So why care if you’re not Jewish? Because a few years ago, while Madoff and Stanford were still raking in their victims’ nest eggs, the U.S. Securities and Exchange Commission released a fact sheet warning titled “Affinity Fraud: How To Avoid Investment Scams That Target Groups.”
In it, the SEC warned that Ponzi and pyramid scheme fraudsters had been exploiting the ethnic, religious, and other bonds they shared to gain the confidence of their victims. Koreans had ripped off fellow Koreans, African American hucksters hit black churches, and elderly con artists have ripped off fellow retirees.
It could happen to anyone who counts themselves as belonging somewhere.
That makes what happened to Jews in the Madoff ripoff — and especially now with the Stanford Ponzi scheme — a pretty teachable moment.
In the Jewish community there is six degrees of separation. It is hard to go anywhere in the world where Jews can be found not to meet someone who knows someone you know. It is both uncanny and comforting considering our small numbers.
It is these ties that bind which Stanford and Madoff-may they rot in hell-counted on to enrich themselves.
As far as the Mexican Jewish community-I met several of their children who were students with my son at MIT. They came from wealthy, mostly religious and close knit families. A very proud and capable group of students.
The depth of the financial ruin to this close knit community is inestimable.
“” … Exploiting the tight bonds of trust within Jewish communities to get at their money … “”
Sounds, sans super-steroids, like Wall Street’s exploitation of its tight bonds (and revolving doors) with Capital Hill — and 1600 Pennsylvania — to get at ours!
“” … Exploiting the tight bonds of trust within Jewish communities to get at their money … “”
Sounds, sans super-steroids, like Wall Street’s exploitation of its tight bonds (and revolving doors) with Capital Hill — and 1600 Pennsylvania — to get at ours!
“It took a long time for anyone to point out an obvious phenomenon about the $60 billion Bernard Madoff Ponzi scheme, the largest in history. It was that Madoff victimized thousands upon thousands of his fellow American Jews.”
This was pointed out by the media on Day One. Elie Wiesel was interviewed, Hadassah was highlighted, individual Jewish victims were prominent on the list of victims.
I wonder how long it will take for these same groups (Jews, African Americans, Hispanics etc) to realize that their monolithic, unthinking support for the Democratic Party is the same type ripoff
The world has long preyed on the intellect, wealth, integrity and vulnerability of the Jewish people. All that appears to be left for the world’s Jews is to return to their native soil…Israel….where they will be welcomed and defended by Almighty God and Israel’s economic and military might.
According to the Talmud, “All Jews are sureties for one another.” This idea runs all through Judaism and Jewish history; it is difficult to study any Jewish classic without sooner or later encountering this idea that Jews are mutually dependent on one another. When Madoff shattered this bond, he committed a very real sin. One cannot help but wonder how Jews will relate to one another in the future if it becomes evident that they are no longer “sureties” for their fellows.
It is sad that family and community ties are used to steal from people. It doesn’t matter what religion, family, or community is the victim this is something that only the lowest of the low would do. Stanford needs to have his every asset stripped from him and sold to reimburse his victims, then given a nice long stay in the general population of a Mexican prison.
Where were the “watchdogs” that are paid to protect the public? Surely the auditors and accountants know what’s going on; why aren’t they also in jail.
Madoff was but the tip of the iceberg in the Bush, neo-con golden age of greed. By 2008 this mighty facade of wealth had become nothing more than a house of cards. Sustained by the insatiable lust for money and moral bankruptcy. What was left? America’s, indeed the worlds, financial institutions will take years to recover, and there are many individuals that have lost everything and may never recover in their lifetime. But Madoff was correct…it was a culture and it was multi-cultural…and he was not alone. Will it happen again?..of course it will.
Given that Jewish people are overwhelmingly socialists, it should come as little surprise that they are overwhelmingly naive. What has been done to them, not just by these criminals, but historically, one would imagine that they might be a little more cynical. A little more careful. Judging by performance rather than rhetoric is a good place to start. My heart goes out to the good people that have lost so much.
#8
He’ll just end up expanding the skill sets of wanna-be narcos!
Why are so many of these people close friends of with Sean Hannity?
PC I got one word for you.
Enron.
Your point about exploiting interpersonal trust (“affinity fraud”) inside the Jewish community is well borne out by this Vanity Fair piece on Madoff.
Madoff’s World
Poor Citizen:
Bernie Madoff is a Democrat who was a big contributor to the Democrat Pary and Barak Obama. R Allan Stanford was more bipartisan in his giving although more money went to Democrats the Republicans.
16: Jerryofva
I never cared what his party affiliation was, he (and many others of the same ILK..) made their money during the culture of greed that went almost unchecked….and the result????… just look up world history 2006, 2007 and 2008 (financial stories). And, we are still trying to recover…You will see what I speak of… trust me.
11: Johnny Dunn: Through what source-other than personal prejudice- do you derive your conclusion that ‘Jewish people are overwhelmingly socialist and that they are overwhelmingly naive’?
Anyone who got scorched by Madoff or immolated by Stanford, regardless of their relgious affiliation, deserves some commiseration. Greed and the desire for excess return can lead anyyone to the poorhouse.
“If someting seems too good to be true, it is” should replace the golden rule.
I can’t speak to the naive-ness of the Jewish people, but Norman Podhoretz has just written a book, “Why Are Jews Liberals?” that examines why Jews are socialists/liberals/progressives/whatever.
Quote from the Washington Post review at Amazon:
“Liberalism has become the religion of American Jews,” he writes, “even though it conflicts in substance with the Torah . . . [and] the most basic of all Jewish interests — the survival of the Jewish people.”
http://www.amazon.com/Why-Jews-Liberals-Norman-Podhoretz/dp/0385529198
Boots @ 19: The agnostic Jewish people will soon throw off the chains of leftism and return to their God out of necessity. Anti-Semitism is growing worldwide, and will force Jews from their comfortable, secular lives in America, Europe and the rest of the world. Israel will soon be their only refuge.
6. Saltherring: “All that appears to be left for the world’s Jews is to return to their native soil…Israel…where they will be welcomed and defended by Almighty God and Israel’s economic and military might.”
Most Israelis would laugh at this! Israel is full of Jewish predators and Jewish prey. It’s survival of the fittest there.
simon holmes!
P.C. You consistently prove our point. 2006, 2007, 2008 as well as 2009, the Democratic reign. And it sounds silly when you try to blame it on Bush. Does Barney Frank and Chris Dodd ring a bell?
21 says, “Most Israelis would laugh at this! Israel is full of Jewish predators and Jewish prey. It’s survival of the fittest there.”
It will become much worse for them here and in Europe than it is in Israel.