Robert Jaffe (stockbroker)
Encyclopedia
Robert M. Jaffe an American stockbroker, and long-time associate of Bernard Madoff
, promoted Madoff's fund to wealthy investors in Massachusetts
and Florida
. Jaffe has homes in Weston, Massachusetts
and in Palm Beach, Florida, Cohmad Securities
Corporation employs Robert Jaffe, as vice-president. Jaffe is married to Ellen Shapiro, daughter of Boston philanthropist Carl J. Shapiro
, the founder and former chairman of apparel company Kay Windsor Inc. and an early investor and close friend of Madoff. Jaffe reportedly convinced the elder Shapiro to invest $250 million with Madoff just 10 days before Madoff's arrest.
The brokerage firm lists its address as Madoff's firm's address in New York City. Cohmad received $67 million in generated fees from Madoff investments, from 2000 to 2008.
circuit", and attracted many Palm Beach Country Club members as investors." Jaffe brought in 150 accounts and more than $1 billion to Madoff. Madoff paid Jaffe directly through accounts he kept with Madoff at much higher returns than earned by other investors. Between 1996 and 2008, Jaffe withdrew at least $150 million, and the U.S. Securities and Exchange Commission (SEC) claims he was aware Madoff was engaged in fictitious trading. Jaffe has said he received a commission of 1% to 2% from an investor's first profit, and he paid commissions to financial advisers who steered cash to Madoff's fund.
of the Commonwealth of Massachusetts
, in charge of securities issues for Massachusetts, filed suit against Jaffe.
On February 4, compelled to testify, Jaffe invoked his Fifth Amendment
right. He responded that he was also one of Madoff's victims.
On May 8, 2009, the Commonwealth of Massachusetts found the firm to be in “default” for not assisting regulators. Cohmad’s securities registration has been revoked, and they must provide an accounting of all fees the company or its agents earned for referring Massachusetts investors to Mr. Madoff's firm as well as, pay a $100,000 fine for failing to cooperate with the state securities investigation.
On June 22, 2009, Madoff Trustee, Irving Picard
filed a claim against Cohmad. Robert Jaffe was named as a defendant among more than two dozen individuals and trusts in U.S. Bankruptcy Court in New York.
The lawsuit claims that up to 90 percent of Cohmad’s income came from referring clients and that the firm had a “symbiotic” relationship with Madoff, having earned hundreds of millions of dollars from the fraud. The lawsuit seeks more than $100 million paid to Cohmad six years prior to Madoff’s firm declaring bankruptcy, and more than $105 million in profits Cohmad employees and their families withdrew from the investment accounts they held with Madoff.
The case is Picard v. Cohmad Securities Corp., 09-AP-1305, U.S. Bankruptcy Court, Southern District of New York (Manhattan).
On June 22, 2009, the SEC also filed civil fraud charges
against Cohmad, and Jaffe was also named as a defendant. The lawsuit alleges the company was Madoff's "in-house marketing arm" and critical to Madoff's scam. Cohmad representatives were paid for funds they brought into the firm but not for any increase in the investments' value. Withdrawals were treated as a loss, which "suggested that profits generated by Madoff were fictitious", but Madoff changed the arrangement in 2002 and began paying Cohmad representatives $2 million a year. The case is SEC v. Cohmad Securities Corp., 09 Civ. 5680.
Bernard Madoff
Bernard Lawrence "Bernie" Madoff is a former American businessman, stockbroker, investment advisor, and financier. He is the former non-executive chairman of the NASDAQ stock market, and the admitted operator of a Ponzi scheme that is considered to be the largest financial fraud in U.S...
, promoted Madoff's fund to wealthy investors in Massachusetts
Massachusetts
The Commonwealth of Massachusetts is a state in the New England region of the northeastern United States of America. It is bordered by Rhode Island and Connecticut to the south, New York to the west, and Vermont and New Hampshire to the north; at its east lies the Atlantic Ocean. As of the 2010...
and Florida
Florida
Florida is a state in the southeastern United States, located on the nation's Atlantic and Gulf coasts. It is bordered to the west by the Gulf of Mexico, to the north by Alabama and Georgia and to the east by the Atlantic Ocean. With a population of 18,801,310 as measured by the 2010 census, it...
. Jaffe has homes in Weston, Massachusetts
Weston, Massachusetts
Weston is a suburb of Boston located in Middlesex County, Massachusetts, United States in the Boston metro area. The population of Weston, according to the 2010 U.S. Census, is 11,261....
and in Palm Beach, Florida, Cohmad Securities
Cohmad Securities
Cohmad Securities, whose name combines “Cohn” and “Madoff,” founded in 1985 by Bernard Madoff and Maurice Cohn, Madoff’s friend and former neighbor. It is in the Business Services, N.E.C. industry in NEW YORK, NY...
Corporation employs Robert Jaffe, as vice-president. Jaffe is married to Ellen Shapiro, daughter of Boston philanthropist Carl J. Shapiro
Carl J. Shapiro
Carl J. Shapiro is a Boston philanthropist and entrepreneur. He and his wife, Ruth live in Boston and Palm Beach. In 1939, he founded Kay Windsor, Inc., in New Bedford, Massachusetts, and built it into one of the largest women's apparel companies in the country...
, the founder and former chairman of apparel company Kay Windsor Inc. and an early investor and close friend of Madoff. Jaffe reportedly convinced the elder Shapiro to invest $250 million with Madoff just 10 days before Madoff's arrest.
Cohmad Securities Corporation
Maurice "Sonny" Cohn owned 48% of Cohmad, and his daughter Marcia, who served as president and chief compliance officer, owned 25%. Madoff owned 15%. Mr. Madoff's brother Peter owned 9%, and Mr. Cohn's brother owned 1%, and another unnamed Cohmad employee owned 1%.The brokerage firm lists its address as Madoff's firm's address in New York City. Cohmad received $67 million in generated fees from Madoff investments, from 2000 to 2008.
Bernard Madoff agent
A bon vivant and philanthropist, Jaffe "worked the Palm Beach, FloridaPalm Beach, Florida
The Town of Palm Beach is an incorporated town in Palm Beach County, Florida, United States. The Intracoastal Waterway separates it from the neighboring cities of West Palm Beach and Lake Worth...
circuit", and attracted many Palm Beach Country Club members as investors." Jaffe brought in 150 accounts and more than $1 billion to Madoff. Madoff paid Jaffe directly through accounts he kept with Madoff at much higher returns than earned by other investors. Between 1996 and 2008, Jaffe withdrew at least $150 million, and the U.S. Securities and Exchange Commission (SEC) claims he was aware Madoff was engaged in fictitious trading. Jaffe has said he received a commission of 1% to 2% from an investor's first profit, and he paid commissions to financial advisers who steered cash to Madoff's fund.
Civil lawsuits
On January 14, 2009, William Galvin, Secretary of StateSecretary of State
Secretary of State or State Secretary is a commonly used title for a senior or mid-level post in governments around the world. The role varies between countries, and in some cases there are multiple Secretaries of State in the Government....
of the Commonwealth of Massachusetts
Massachusetts
The Commonwealth of Massachusetts is a state in the New England region of the northeastern United States of America. It is bordered by Rhode Island and Connecticut to the south, New York to the west, and Vermont and New Hampshire to the north; at its east lies the Atlantic Ocean. As of the 2010...
, in charge of securities issues for Massachusetts, filed suit against Jaffe.
On February 4, compelled to testify, Jaffe invoked his Fifth Amendment
Fifth Amendment to the United States Constitution
The Fifth Amendment to the United States Constitution, which is part of the Bill of Rights, protects against abuse of government authority in a legal procedure. Its guarantees stem from English common law which traces back to the Magna Carta in 1215...
right. He responded that he was also one of Madoff's victims.
On May 8, 2009, the Commonwealth of Massachusetts found the firm to be in “default” for not assisting regulators. Cohmad’s securities registration has been revoked, and they must provide an accounting of all fees the company or its agents earned for referring Massachusetts investors to Mr. Madoff's firm as well as, pay a $100,000 fine for failing to cooperate with the state securities investigation.
On June 22, 2009, Madoff Trustee, Irving Picard
Irving Picard
Irving H. Picard is a partner in the law firm Baker Hostetler. He graduated from the Wharton School, University of Pennsylvania, with a B.S. degree , from Boston University School of Law with a J.D. degree , and from the New York University School of Law with an LL.M. degree in 1967, and was...
filed a claim against Cohmad. Robert Jaffe was named as a defendant among more than two dozen individuals and trusts in U.S. Bankruptcy Court in New York.
The lawsuit claims that up to 90 percent of Cohmad’s income came from referring clients and that the firm had a “symbiotic” relationship with Madoff, having earned hundreds of millions of dollars from the fraud. The lawsuit seeks more than $100 million paid to Cohmad six years prior to Madoff’s firm declaring bankruptcy, and more than $105 million in profits Cohmad employees and their families withdrew from the investment accounts they held with Madoff.
The case is Picard v. Cohmad Securities Corp., 09-AP-1305, U.S. Bankruptcy Court, Southern District of New York (Manhattan).
On June 22, 2009, the SEC also filed civil fraud charges
against Cohmad, and Jaffe was also named as a defendant. The lawsuit alleges the company was Madoff's "in-house marketing arm" and critical to Madoff's scam. Cohmad representatives were paid for funds they brought into the firm but not for any increase in the investments' value. Withdrawals were treated as a loss, which "suggested that profits generated by Madoff were fictitious", but Madoff changed the arrangement in 2002 and began paying Cohmad representatives $2 million a year. The case is SEC v. Cohmad Securities Corp., 09 Civ. 5680.
External links
- Commonwealth of Massachusett Secretary of State Complaint, January 14, 2009
- Picard v. Cohmad Securities Corp. 09-AP-1305, June 22, 2009
- SEC v. Cohmad Securities Corp., 09 Civ. 5680, June 22, 2009
- "Jaffe Tarnished as Feds Investigate Madoff Connection", Palm Beach Post (December 20, 2008)
- Beth Healy, "Broker Ordered to Appear at Madoff-Related Hearing", Boston Globe (January 15, 2009)