Madoff's '$9 Billion Stash' Claim Is Likely a Desperate Ploy to Stay in the Headlines

Early Monday morning, New York Post writer Dan Mangan published a rumor about Bernie Madoff. According to one of the Ponzi schemer's fellow inmates at the federal correctional complex in Butner, North Carolina, Madoff has been bragging, that he has "stashed" $9 billion with three close friends.

The inmate went on to assert that Madoff's former employee, Frank DiPascali, knows who the three people are, and is using the information to plea bargain with federal law enforcement officials.

Fact Versus Fiction

The story makes a strange kind of sense. Madoff's wife remains in the public eye, which makes her a bad bet for hidden money; meanwhile, his strained relationship with his sons ensures that they wouldn't be among his confidantes. And DiPascali, who remains behind bars because of his inability to post a $10 million bail, has already pled guilty to 10 felony counts in relation to his work with Madoff's firm. In custody for almost a year, DiPascali has been extremely forthcoming with investigators. In a way, the stashed money rumor is perfect: possible, yet completely unprovable, it is the kind of story that can hold up indefinitely, and will continue to give Madoff the attention that he seems to crave.

Just a matter of hours after the New York Post story first appeared, it was splashed across the media world, from Fox News to the Huffington Post and all points in between. It didn't hurt that the Butner informant had also included some juicy details about Madoff's life. According to him, the swindler was now dealing with a collection of emotional and marital difficulties, largely stemming from a tell-all book by Sheryl Weinstein, allegedly Madoff's former mistress. In addition to claiming that Madoff cheated on his wife, Weinstein's book hit below the belt -- literally -- with its claim that he was "not well endowed."

While Ruth seems to have forgiven her man -- according to the unknown informant, she bought "a regular car" and still visits -- the stress of prison life and public humiliation has driven Madoff into therapy. Allegedly, he is now in regular sessions with a prison psychiatrist and is taking antidepressants. While these have apparently helped with his stress, they also may have caused him to pass out, breaking his glasses and ribs.

A Ploy to Stay in the Headlines

While compelling, the story that Madoff has stashed money contradicts earlier claims that he has made while in prison. According to a previous account in New York Magazine, when one inmate asked him where his money was, Madoff said "'It's H2O,'... making a gesture of water slipping through his hand." On the other hand, it isn't hard to see why Madoff might want to tell his fellow inmates that he has money: by all accounts, he enjoys the attention that his notoriety has bought him, and anything that he can do to keep his name in the headlines will help to improve his stature behind bars. In fact, according to the New York Post account, Madoff regularly watches CNN, eager to see if there is any news about him.

It isn't surprising that Madoff is so obsessed with his place in the headlines. By all accounts, his notoriety has given him a comfortable -- even privileged -- place in the prison hierarchy. During his regular CNN viewing, he is allegedly joined by his closest companion, Jonathan Pollard. Pollard, who was convicted of spying for Israel in 1987, is currently serving a life sentence, and has found his own cushy spot as unofficial leader of the "Lifer's Club," a group of prisoners who will likely die in Butner. Madoff is in the group, as are extortionist Gary Karr and mail-bomber Stephan Bullis. In addition to Pollard's group, Madoff is also friendly with Carmine Persico, the Boss of New York's Colombo crime family.

Beyond his high-profile pals, Madoff is apparently well-regarded in the prison community, where his business acumen and skill as a confidence man make him a prized mentor among the more ambitious inmates. Of course, much of this popularity is dependent upon Madoff's ability to continue to keep his name in the news. With that in mind, chances are good that unsubstantiated -- and unprovable -- rumors will continue to leak out from Butner, at least until Madoff has permanently established himself in the prison hierarchy.