Fool Me Thrice: New York Businessman Fell Prey To Enron, Madoff, And FTX Scams

Robert Belfer, an oil entrepreneur and the patriarch of the elite Belfer family, lost money during the bankruptcy of cryptocurrency platform FTX years after he suffered hits from the collapse of fraudulent energy company Enron and the Ponzi scheme led by Bernie Madoff.

Court documents show that investment funds linked to the Belfer family were included in a list of shareholders for FTX, the fraudulent digital asset company led by 30-year-old Sam Bankman-Fried, according to a report from Financial Times. Belfer Investment Partners and Lime Partners, both of which are linked to the family, held a combined $34.5 million in the company as of the beginning of last year.

Robert Belfer and his wife, Renée, are philanthropists who have donated heavily to the Metropolitan Museum of Art in New York City; the institution’s Greek and Roman galleries bear the Belfer name, as does the international affairs center at Harvard Kennedy School. Robert Belfer is the son of Arthur Belfer, who moved to the United States from Poland soon after Nazi Germany invaded the country. He imported feathers for pillows and sleeping bags before his company began dealing in foam rubber and petroleum products.

Belco Petroleum Corporation later became a Fortune 500 company and was acquired by a predecessor of Enron, making the Belfer family stakeholders in the company. Robert Belfer served on the board of Enron until 2002, five years before the company was rendered insolvent in a development that cost the Belfers some $2 billion.

The family, down to a net worth of approximately $110 million, had a stroke of luck by withdrawing $28 million from the investment advisory run by Bernie Madoff. The late financier’s Ponzi scheme was discovered shortly after the stock market crash of 2008. Irving Picard, the trustee appointed to claw back funds on behalf of the Madoff victims, filed suit against the family to obtain investments in an attempt to aid other victims, according to a report from the New York Post. The result of the legal proceedings is unknown.

Bankman-Fried, whose alleged misconduct has often been compared to the Madoff scheme, pleaded not guilty earlier this month to eight charges, including conspiracy to commit wire fraud and conspiracy to commit securities fraud. Celebrities such as Tampa Bay Buccaneers quarterback Tom Brady and supermodel ex-wife Gisele Bündchen received combinations of equity and cryptocurrencies as reimbursement for appearing in advertisements and publicly endorsing FTX; they now face a lawsuit accusing them of participating in a “fraudulent scheme” against unsophisticated investors.

FTX collapsed after users learned that their funds were commingled with sister trading firm Alameda Research, which was led by a former love interest of Bankman-Fried. A number of individual users and institutional clients had as much as $8 billion remaining with the company, which Bankman-Fried had attempted to solicit from investors with little success. John Ray III, a bankruptcy lawyer who was appointed to lead the FTX bankruptcy proceedings, told lawmakers that he had never seen “such a complete failure of corporate controls and such a complete absence of trustworthy financial information.”

Bankman-Fried and fellow executives had used the funds to purchase luxury tropical real estate and make sizable political contributions to Democratic candidates. Attorneys have recovered some $5 billion in assets to repay defrauded customers and investors.

Feds Search Biden’s Home, Discover More Classified Documents

Federal officials searched President Joe Biden’s home in Wilmington, Delaware, on Friday and discovered more classified items.

“DOJ took possession of materials it deemed within the scope of its inquiry, including six items consisting of documents with classification markings and surrounding materials, some of which were from the President’s service in the Senate and some of which were from his tenure as Vice President,” Bob Bauer, Biden’s personal lawyer, said in a statement. “DOJ also took for further review personally handwritten notes from the vice-presidential years.”

Bauer said that the FBI asked the White House not to comment on the search until it was over. Bauer claimed that the FBI “had full access to the President’s home, including personally handwritten notes, files, papers, binders, memorabilia, to-do lists, schedules, and reminders going back decades.”

Bauer claimed that the president’s team has “attempted to balance the importance of public transparency where appropriate with the established norms and limitations necessary to protect the investigation’s integrity.”

“We will continue to do so throughout the course of our cooperation with DOJ,” Bauer claimed.

Classified documents connected with Biden were first found in his private office at the Penn Biden Center, a think tank in Washington, D.C., on November 2, less than a week before the 2022 midterm elections. Since then, Biden’s attorneys have located more classified documents at Biden’s home in Wilmington, Delaware, on three separate occasions: an unspecified number found in the garage on December 20, one document found in Biden’s study on January 11, and five more found in the study on January 12.

U.S. Attorney General Merrick Garland appointed former U.S. Attorney Robert Hur — who served during the Trump administration — to serve as special counsel in the investigation after the U.S. Attorney for the Northern District of Illinois John Lausch, who was assigned to do an initial review of the case, recommended to Garland that a special counsel be appointed.

Biden responded to the scandal on Thursday by saying that he has “no regrets” over his actions and that getting questions about the investigation “quite frankly bugs” him.

“We’re fully cooperating, looking forward to getting this resolved quickly,” Biden claimed. “I think you’re gonna find there’s nothing there. I have no regrets. I’m following what the lawyers have told me they want me to do — that’s exactly what we’re doing. There’s no there, there.”