Boston School Loses Millions in Madoff Scam

The Maimonides School, an Orthodox Jewish day school in Boston, lost several million dollars in the Bernard Madoff scandal.

In a letter sent to parents and board members, Jeff Swartz, the chair of the school’s board of directors, said the school could have lost up to $5 million from a trust left to it by Maurice Saval, who died in 1988. That trust had yielded more than $8 million in total, according to the letter. Much of Saval’s money in recent years was invested with Madoff.

Swartz estimated that $3 million, approximately 60 percent of the Saval Trust, was lost in the Madoff scandal, and perhaps another $2 million, he said in the letter.

“I know that the trustees of the Saval Trust are pursuing the redemption of their remaining investments held by the money manager that were not invested with the alleged perpetrator of the fraud,” the letter said. “I also know that they have not yet been able to redeem the funds that they believe are still held by that money manager, and so we cannot say with certainty if the loss is limited to $3 million.

“Worst case, there could be an additional $2 million invested in New York. At this point, we simply cannot predict whether the Saval Trust will recover the funds still invested or any of the funds that had been entrusted to the alleged thief.”

The letter said the loss of the Saval Trust, along with the depressed economy, could lead to a need for greater tuition assistance, to lower enrollment in the school, a reduction in annual giving to the school and to an even smaller return on the remaining endowment.