Columbia Law School has reported a loss of $3 million from its endowment as a result of investments linked to Bernie Madoff, according to Bloomberg.com.
The loss was discovered by Columbia administrators after a “review of its investments”—particularly a gift made in 1980 by an unnamed alumnus. This donation was unique in that the benefactor retained the ability to decide how the money should be spent. Normally, gifts go to a “merged endowment pool,” which is monitored by the university’s management company, Columbia spokesperson Robert Hornsby told Bloomberg.
“Only in rare circumstances in the past, and after approval by the University’s gift review committee, has Columbia accepted such a gift to be retained in another form of investment,” Hornsby was quoted as saying.
Since the law school does not release its own endowment numbers separate from the University’s, it is unclear if the $3 million loss will make a substantial dent in its financial profile. Yet despite the loss to the law school’s gifted funds, Columbia has not reported any losses to the merged endowment pool.
Madoff’s multibillion dollar Ponzi scheme fooled financiers into building up a pyramid of essentially fake investments that paid steady returns using money collected from investors. The scam—which was uncovered last month—may have been the largest of its kind in Wall Street’s long history of white-collar stains. Madoff was arrested and is now out on bail.
Columbia Law is just one among the vast number of institutions, politicians, celebrities, and other victims around the world that were swindled directly or indirectly by the fraud of an estimated $50 billion, according to recent reports released by New York City’s federal court.
Bard College, New York University, New York Law School, Yeshiva University, and Tufts University were also mentioned in the Bloomberg report as schools that have disclosed losses in connection to Madoff.
Alexa Davis can be reached at firstname.lastname@example.org
CORRECTION APPENDED: The article originally stated that the University had money invested with J. Ezra Merkin, and that the law school manages its own endowment. This is not true, and Spectator regrets the error.