Birds Of A Feather: Bankman-Fried and Madoff Loved To Accumulate Real Estate With Other People's Money

While financial analysts and media pundits continue to compare the fall of FTX’s Sam Bankman-Fried and criminal Ponzi scheme artist Bernie Madoff, there is a stark difference in the type of wealth they accumulated. But they both enjoyed spending that wealth on real estate.

While Bankman-Fried allegedly sits on a mountain of missing or lost crypto that investors may never see again, Madoff, who died in prison in April 2021, is still paying back his investors — in cash. The U.S. Department of Justice recently repaid another $370 million to victims of Madoff’s notorious Ponzi scheme, for a total of $4 billion.

One similarity that has appeared in the ashes of their business practices is that Bankman-Fried and Madoff both loved collecting high-priced real estate, albeit in different countries.

While much has been written about Bankman-Fried’s $30 million penthouse where he lived with nine colleagues, Bahamian lawyers say FTX executives bought as many as 35 different properties across the Bahamas at a price tag of $256.3 million, and Bahamian regulators want it back. Although few specifics have been revealed about Bankman-Fried’s accumulated real estate properties, Madoff’s real estate holdings have taken on a life of their own and, as recently as 2022, were still being bought and resold.

According to a recent New York Post recap of Madoff’s real estate holdings, his Upper East Side Manhatten penthouse at 133 E. 64th St. has hit the market again for $15 million. Real estate investor Lawrence Benenson last purchased it in 2014 for $14 million. Since Madoff’s arrest on Dec. 11, 2008, this marks the third time that the three-bedroom, 3.5-bathroom residence has been listed for sale.

Meanwhile, Madoff’s Hamptons home is still listed for $22.5 million, having entered and left the market several times over the last few years.

According to Architectural Digest, his Montauk beach house, which has four bedrooms, three baths, a pool and beach rights, was initially valued at $7 million and sold for $9.4 million.

Madoff’s 8,753-square-foot, five-bedroom, 7½-bath Palm Beach house was initially listed at $8.5 million in 2009 and sold in 2013 for more than $9 million.

As for Bankman-Fried’s Bahamian real estate purchases, FTX attorneys said the properties were purchased for his senior staff, and the company was run as his personal fiefdom. According to Reuters, FTX, its senior executives and Bankman-Fried's family have purchased at least 19 properties worth nearly $121 million in the Bahamas over the past two years.

Any properties owned by FTX will now likely be sold to pay the company's creditors, who number more than 1 million and face collective losses in the billions of dollars.

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