That's what happened to $110 million or $14.5 million of their endowment, depending on when you ask Yeshiva honchos how much they lost in the World's biggest and most Jewish Ponzi scheme.
There are few greater sins than to use your position of voluntary power on a non-profit board to reap a profit for yourself. When you agree to serve on a board you say by social contract that you are there to help, to give, to build the agency or school.
To the anti-social personality (i.e., the crook), serving on a board is just another opportunity to make a buck, to take, to help yourself.
How then did Merkin and Madoff get on the board of Yeshiva University, get their fingers into the funds and walk off with millions? How they got on is a story that we eagerly wish to hear. We know now that once there, they got a kosher seal of approval from a lawyer named Ira Milstein, to take the money from the endowment, an approval that was not worth the paper on which it was written.
That's surprising because according to Bloomberg, Millstein is a serious authority in management and law, a senior partner of Weil, Gotshal & Manges and a senior associate dean for corporate governance and a visiting professor at the Yale University School of Management in New Haven, Connecticut. But then again until a few weeks ago both Madoff and Merkin were highly regarded financiers.
In the core of the latest article that chronicles this "3M" alliance that cost Yeshiva its money and its reputation, Bloomberg hits the ball out of the park with this appallingly obvious universal assessment, directly at odds with what Millstein sanctioned:
It generally isn’t wise for a school to do business with its own advisers, said Alice Handy, founder of Investure LLC, which manages about $5 billion for 10 schools and foundations.Understated but elegant. It just is not done. It is treif. But they did it anyhow and now they have a mess.
“It’s preferable never to have a business relationship with a board member,” said Handy, whose company is based in Charlottesville, Virginia, in a Dec. 30 interview.