Here’s another name to add to the list of people who raised money from outside investors for Bernie Madoff’s Ponzi scheme. Keep in mind that these people were essentially enablers to the scam, keeping new money coming in to replace any old money coming out. Were they in on the scam? That remains to be seen.
Today’s new fund raiser is Mike Sullivan, whose role in the scam has been uncovered by Bob Norman at the Broward/Palm Beach New Times. Norman has been doing great work on this story, by the way, reguarly beating much bigger and more established news outfits with new angles on the Madoff affair.
The story here is that Sullivan apparently filled in for Bienes and Avellino, Madoff’s oldest fund raisers, when the SEC got tough with them. From Norman:
When it comes to $50 billion swindler Bernie Madoff’s cronies in Broward County, we know about Michael Bienes and Frank Avellino. Now we can add the name Michael D. Sullivan to the list. Sullivan for years has been running a feeder fund for Madoff in his office on Federal Highway in Fort Lauderdale.
Sullivan appears to have come into the picture in 1992, after the SEC shut down long-time long-time Madoff money raisers Bienes and Avellino for selling unlicensed securities. Bienes and Avellino simply steered some of the investors, who’d gotten their money back courtesy of the SEC, to Sullivan, who then put the money right back in with Madoff.
After the scandal broke, Sullivan wrote a letter to all the investors in his fund telling them that their money was lost. Sullivan doesn’t appear to have run a particularly large fund (I’ve heard estimates from $60 million to $200 million, but can’t vouch for their accuracy), but he was definitely a go-to guy for Bienes and Avellino. Interestingly, the Florida Office of Financial Regulation tells me he’s not licensed as a securities broker or investment advisor.