The Industry awaits scam fallout

List of Madoff victims continues to grow

The roster of investors bilked by Bernard Madoff continued to grow Monday, with Mort Zuckerman and a charity linked to Steven Spielberg among the confirmed victims.

As Hollywood and a range of deep-pocketed individuals and nonprofits sort out their exposure, they’re confronting a new wrinkle: the chance that past fraudulent gains may have to be repaid. The potential timetable for repayment is not yet clear, but those tracking the debacle closely said it could stretch back several years.

“The amazing thing is the leverage,” said one investment bank exec. “Investors in Madoff’s funds used the gains they made to secure other positions in other funds and institutions. So the damage is not just the initial investment. It’s all of the tentacles and however far they stretch.”

Madoff, a legendary trader and former chairman of the Nasdaq, has been charged with operating a Ponzi scheme whose losses are estimated to be $50 billion. Over the weekend, the list of victims started to feature recognizable names from the media/entertainment sector, including Sam Engelbardt, a film producer and financier, and Sterling Equities, an investment fund led by New York Mets owner Fred Wilpon that founded regional cable net SportsNet New York.

Spielberg’s Wunderkinder Foundation had a large chunk of its assets tied up with Madoff, a rep for the mogul confirmed.

Authorities have said little since arresting Madoff, who is expected in court later this week. His attorney called the events “a tragedy.”

Wall Street reacted with surprising skittishness to the news, with the scandal being blamed for the Dow’s 65-point decline Monday.

Many of those with exposure to Madoff come from wealthy and predominantly Jewish circles, especially in Palm Beach, Fla., where Madoff allegedly exploited longtime country club ties.

Well-heeled investors across the country were reported to be hit, including Ira Rennert, whose home in the Hamptons is said to be the largest in America, valued this year at $185 million.

Schools and nonprofits also sustained serious losses, especially those anchored in the Jewish community.

Yeshiva U., where Madoff served until this month as treasurer of the board of trustees and board chairman of the business school, is said to have losses in the range of $100 million.

The Jewish Federation of Los Angeles said it may have lost $6.4 million, or 11% of its endowment. The Ramaz School on Manhattan’s Upper East Side, whose alums include critic Daphne Merkin and author Elizabeth Wurtzel, reportedly had much of its endowment tied up with Madoff.

Cable news buzzed with Madoff updates throughout the day Monday, especially CNBC, where the news followed close on the heels of the cataclysms of this unforgettable autumn.

“I am going to be much more risk-averse in my investments,” Daily News owner Mort Zuckerman told the net. “I’m staying out of stocks.”

Zuckerman said his charitable giving will continue unabated — though it was difficult to know how many of his contemporaries would be able to maintain stride.

One studio topper spoke for many in Hollywood when he described a weekend spent assessing the damage, as if after a bout with bad weather.

“I know a couple of people who have been hurt badly by this,” the exec said. “And you do wonder if there are privately held assets that will have to change hands as a result. But we just don’t have enough information yet.”

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