Is Carl Shapiro a Madoff Victim?

The WSJ has found what seems, on its face, to be one of the most tragic stories of the Madoff affair:

Carl Shapiro, a 95-year-old apparel entrepreneur and investor, had $545 million with Mr. Madoff -- creating what could become the largest personal loss yet in the scandal. Carey O'Donnell, a spokeswoman for the family, confirmed that Mr. Shapiro's charitable foundation, the Carl & Ruth Shapiro Family Foundation, invested $145 million with Madoff.

But then Shapirio puts out a weirdly defensive statement:

In a statement yesterday, Mr. Shapiro said that "at no time did I ever formally introduce individuals as potential investors with Mr. Madoff." Mr. Shapiro said he had been friends with Mr. Madoff for more than 50 years, and "any decisions I or my family foundation made to invest with him were based on his apparent business acumen, sense of integrity and commitment to sound investing principles."

A bit of math shows that Shapiro, far from suffering "the largest personal loss yet in the scandal", might actually have been the single largest personal gainer from Madoff's Ponzi scheme.

Madoff has been reporting pretty consistent returns on the order of 13% a year; Shapiro sold his company in 1971. If he invested $6 million with Madoff in 1971, and it compounded at 13%, that would bring him up to $545 million today.

In the interim, Shapiro has become a major philanthropist, and has surely taken out of his Madoff account orders of magnitude more than the money he originally invested. The damage to his foundation is immense, and horrible. But there's a good chance that many of the recipients of his largesse over the past few decades have in fact been paid out with Ponzi money, and that Shapiro has managed to give away much more than if he had never been invested with Madoff at all.