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High-Tech Execs Victims Of Madoff's Ponzi Scheme

Madoff was accused of one count of securities fraud after authorities said he admitted to running a scheme over many years with losses of $50 billion.

W. David Gardner

February 9, 2009

2 Min Read

Some of the best and brightest of the computer and high-tech industries got caught in the Ponzi scheme operated by Bernard L. Madoff.

Madoff's customer list has been made public and it includes the names of some successful high-tech figures, some of them industry legends.

Madoff was accused of one count of securities fraud after authorities said he admitted to running a scheme over many years with losses of $50 billion, which would be the biggest fraud in Wall Street history.

Roger Marino -- the "M" in EMC Corp. -- said he lost "a lot of money" investing in Madoff's scheme. He told the Boston Globe that the Madoff scandal was "unfathomable" and he indicated he couldn't see how it could have been discovered before it became public that Madoff had swindled investors. Marino invested over a period of 10 years.

Marino and Richard Egan -- the "E" in EMC -- started their company on a shoestring two decades ago and took advantage of their own designs and a downturn in IBM's disk drive business to make EMC a powerhouse in the storage business. Today, EMC is the largest high tech company in New England. Neither Egan nor Marino are involved any longer in the day-to-day operation of EMC.

Another high-tech luminary who got caught in the Madoff scandal was Sen. Frank Lautenberg, D-N.J. Lautenberg was a co-founder of Automatic Data Processing (ADP). Lautenberg built ADP into a software payroll giant. After he became a U.S. senator, he continued his interest in high technology, among other measures sponsoring legislation aimed at spreading Wi-Fi technology.

Another name on the Madoff list was venture capitalist Arthur Rock, a key figure in financing early semiconductor companies before the San Francisco Bay area was called "Silicon Valley." As a broker for investment banking firm Hayden Stone, Rock invested in a group of scientists that started pioneering semiconductor company, Fairchild Semiconductor. Later, Rock invested in and helped guide Intel and Apple Computer. Reporters weren't able to reach Rock for confirmation of his name on the Madoff victims' list.

One former high-tech venture capitalist who dodged the Madoff scam bullet was Frederick Adler, who financed a string of computer companies, including Data General. Adler told The New York Times that he had pulled out of the stock market during the tech bubble.

"Look, I'm an ex-litigator and I can usually smell a crook a mile away," said Adler, now a Palm Beach entrepreneur who had invested a modest sum with Madoff in the '90s. "But I didn't get any odor from him."

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