Stanley Chais was a Beverly Hills, California

Beverly Hills, California

Beverly Hills is an affluent city located in Los Angeles County, California, United States. With a population of 34,109 at the 2010 census, up from 33,784 as of the 2000 census, it is home to numerous Hollywood celebrities. Beverly Hills and the neighboring city of West Hollywood are together...

 investment advisor who operated "feeder funds" which collected money for funds related to the Madoff investment scandal

Madoff investment scandal

The Madoff investment scandal broke in December 2008 when former NASDAQ chairman Bernard Madoff admitted that the wealth management arm of his business was an elaborate Ponzi scheme....

. He was born in Bronx, New York.

Involvement in Madoff's Ponzi scheme

Chais operated three funds that offered returns of up to 25%. He told clients that he achieved the returns using a complex combination of derivatives, stock, currency and futures trading. Instead, the funds were merely funneled into Madoff's Ponzi scheme

Ponzi scheme

A Ponzi scheme is a fraudulent investment operation that pays returns to its investors from their own money or the money paid by subsequent investors, rather than from any actual profit earned by the individual or organization running the operation...

.

On May 1, 2009 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...

, bankruptcy trustee for Madoff Securities, filed a lawsuit against Stanley Chais. The complaint alleges he "knew or should have known" he was deep in a Ponzi scheme when his family investments with Madoff averaged 40% and sometimes soared as high as 300%. It also claims Chais was a primary beneficiary of the scheme for at least 30 years, allowing his family to withdraw more than $1 billion from their accounts since 1995 - money that belonged to Madoff victims. The case number is Picard v. Chais, 09-01172.

On June 22, 2009, the Securities and Exchange Commission filed civil fraud charges against Chais.

On September 23, 2009, California Attorney General Jerry Brown

Jerry Brown

Edmund Gerald "Jerry" Brown, Jr. is an American politician. Brown served as the 34th Governor of California , and is currently serving as the 39th California Governor...

 filed a lawsuit against Chais seeking $25 million in penalties and restitution for victims.
Chais died on September 26, 2010 at age 84 in Manhattan

Manhattan

Manhattan is the oldest and the most densely populated of the five boroughs of New York City. Located primarily on the island of Manhattan at the mouth of the Hudson River, the boundaries of the borough are identical to those of New York County, an original county of the state of New York...

, where he and his wife had moved to further the treatment of a blood disorder that eventually took his life.

Philanthropy

Chais founded the Chais Family Foundation, which donated extensively to organizations that preserve and further Jewish history and culture, from reestablishing and maintaining Jewish culture in areas where it was diminished by the Holocaust and by Soviet policy, to Israeli organizations. "In Israel, Chais sat on the boards of Technion, Weizmann Institute and Hebrew University of Jerusalem

Hebrew University of Jerusalem

The Hebrew University of Jerusalem ; ; abbreviated HUJI) is Israel's second-oldest university, after the Technion – Israel Institute of Technology. The Hebrew University has three campuses in Jerusalem and one in Rehovot. The world's largest Jewish studies library is located on its Edmond J...

." The foundation, which had been funded through the Madoff scam, collapsed in December 2008
.