The executive vice president of the American Technion Society, which lost in essence $72 million in the Bernie Madoff scheme, told the Fundermentalist that there would have been very little his organization could have done to avoid getting bilked.
The Technion society lost $29 million it had invested in Madoff Securities, and then another $43 million in “profits” it made and then reinvested with Madoff — money that Melvyn H. Bloom, executive vice president of the organization now calls “illusory.”
The organization became involved with Madoff in 1995, with a multi-million dollar investment that was approved by the group’s investment committee, which is made up of lay leaders.
“This is the one area of our organization, investment management, in which our lay people have the greatest involvement,” Bloom told the Fundermentalist on Monday, “because they have the greatest amount of expertise in the area.”
Still, Bloom said, he does not blame the 15-member committee.
“The committee," he added, "operates with great skill." That said, the organization is trying to reevaluate how it actually operates. “We will have to look at procedures and standards and have to determine whether anything needs to be changed or revised," Bloom said.
The investment committee has already met once since news of the Madoff scandal broke and it became apparent that the Technion society took a significant hit; the group’s audit committee will meet in January to discuss the situation further.
Aside from the direct losses through investment in Madoff, Bloom said that a number of donors that personally invested with him have also suffered serious blows.
Among them is Joseph Gurwin, an 88-year-old retired manufacturer who resides in Palm Beach. Gurwin, whose $28 million foundation gave away $1.2 million in 2007, was heavily invested in Madoff, according to the Wall Street Journal.
He was a multi-million dollar donor to the Technion society, according to Bloom, and he financed the school’s Gurwin II satellite, which is now orbiting Earth.
Now, the society is trying to regain its footing.
“We hope over time we will rebuild our endowment and also do a lot of fundraising that is not related to out endowment,” Bloom said. “We have to continue to campaign strongly, to move ahead. We are a very successful fund raising organization. That hasn’t changed. The cast of characters hasn’t changed. We intend to move ahead as we always have.”