Fort Lauderdale Philanthropist Tied To Epic Swindler Madoff -- UPDATED
Michael Bienes doesn't make a lot of news and hasn't been involved much in local politics, but if you look around you'll see the tall and seemingly kindly Fort Lauderdale multi-millionaire's name all over the place.
At Holy Cross Hospital, there's the Michael and Dianne Bienes Comprehensive Cancer Center. At the Broward County Library in downtown there's the Bienes Museum of the Modern Book, a wing stocked with rare book collections. He's deeply involved with Nova Southeastern University, serving on its board of trustees, and volunteers as secretary for the Performing Arts Center Authority, to which he has donated large sums of money. And that's just the tip of the iceberg, as Bienes has been a benefactor for everything from Pine Crest to the African American Research Library to St. Thomas Aquinas High School.
Today, you just have to wonder if any of that money was connected to the world's most prolific rip-off artist, Bernard Madoff, the engineer of a $50 billion ponzi scheme that has devastated wealthy investors around the world, many of them in South Florida.
Bienes, an accountant who lives in a house assessed at about $7 million on swank Bay Colony Drive in Fort Lauderdale, once had deep ties to Madoff. How deep I'm not sure -- and I want to make it clear that there's no evidence that Bienes has current ties to Madoff or has done anything wrong in recent years.
But Bienes and his Palm Beach partner, Frank Avellino, raised hundreds of millions of dollars for the felonious financier in the past -- and ran into trouble for it back in 1992. The pair were investigated by the SEC after it was discovered they'd sold $440 million worth of unregistered securities over a period of many years. They promised high returns to investors, saying they were handing the money over to an unnamed broker. The SEC identified the mystery broker as Bernard Madoff. Read a fascinating 1992 Wall Street Journal article here. It's not clear how the case was resolved, but here's a bit of SEC info on it. It appears to be another example of the SEC playing footsie with Madoff -- until the Ponzi bombshell knocked the world's financial community's socks off.
I spoke with local attorney Jeffrey Sonn, who is representing Madoff victims in the fraud case, and he said he has been contacted by one victim who initially invested with Madoff through Bienes. Sonn said that as far as he knows, Bienes and Avellino were shut down by the SEC and were barred from selling securities.
Currently, Bienes and Avellino run a company called Mayfair Bookkeeping Services. Perhaps coincidentally, Madoff has a financial base in Mayfair, England, where the Evening Standard reported that he kept his "dynastic piggy bank." The tall, soft-spoken Bienes also owns a home in the London area, where he is involved with the Royal Opera House and other high-society interests.
Interestingly, the pair's attorney in the SEC case was Ira Sorkin. Madoff's current attorney: Ira Sorkin.
Among Madoff's now-poorer clients are Steven Spielberg, former U.S. Sen. Frank Lautenberg, Norman Braman, and a slew of the well-heeled members at Palm Beach Country Club. Madoff was a member of the club and owns an ocean-front mansion with a huge private dock next door to The Breakers hotel.
The fallout, if any, for Bienes, who is about 70 years-old, isn't clear and I'm in no position to speculate. But I wonder if he didn't encourage other wealthy Fort Lauderdale folks to invest with Madoff. Broward County Commissioner John Rodstrom told me that he knows Bienes and considers him one of the most charitable people he's ever seen in Fort Lauderdale.
"I don't know how he made his money, but he's been very philanthropic," Rodstrom said.
His donations in Florida have tallied $30 million, according to a 2005 article in an English publication run by the Genesis Foundation. Since then he and his wife have given at least another $4 million to Holy Cross and most recently he's been pouring money into St. Thomas Aquinas. And that's just Florida. From the Genesis article:
Michael and Dianne Bienes are, they say, "just two people who give money to things we like", doing it "by instinct, with emotion, preferably with some fun attached". They're a flamboyant pair: they dress to kill, they like to party, and they're legendarily good hosts, which explains their presence a few Sundays ago at Glyndebourne, hosting a formidably extravagant dinner in the former Green Room.
The Bieneses love Glyndebourne, which is why they write it cheques. They also love the English Chamber Orchestra, with similar results. Dianne and Michael are both on the Board, and in September they are organising an ECO fundraising dinner at Windsor Castle with the Prince of Wales. Tables are £10,000 a piece, if you're free.
Like Studzinski, they're American and self-made. Both accountants, they got lucky on the New York Stock Exchange, retired to Fort Lauderdale, and started to support good causes there, such as hospitals, schools, churches (devout Catholics again). But at the same time they turned into music patrons: "We were simply ticket-buyers who decided to do more than buy the tickets." Initially the money, around $30m given out to date, went to local ventures such as the Florida Philharmonic Orchestra and Florida Grand Opera.
But after some issues about the way the beneficiaries were spending it, "We're charitable but we're not stupid," says Michael, ruefully they decided to, in their words, "get out of the box". They liked London (they keep a flat here, behind the Ritz Hotel) so they shifted a large part of their giving to Britain. The Royal Opera and the Donmar Warehouse now get their money too ("We liked the Donmar, so we went to the box office and asked if they were interested"). And as their latest project is a small theatre back in Florida, they're busy brokering transatlantic relationships so that the Donmar and Royal Opera studio shows can tour there.
Ask them why they do all this and Michael will tell you "it gives us a sense of belonging in London. We like people. Through our giving we meet more people that we like." And he might add that when you write large cheques you're never short of friends, not always of the kind you'd choose. "Oh, we can sniff them out," Michael adds, "the hunters. You can't hunt us. We pick and choose."
Got lucky on the stock exchange, eh? Sounds better than "illegally raised $440 million for Bernie Madoff." You know what they say about every great fortune.