Savings lost to Madoff, elderly forced back to work

By Jason Szep

BOSTON (Reuters) - After losing his entire life's savings to disgraced fund manager Bernard Madoff, 90-year-old Ian Thiermann abandoned retirement and now works the aisles of a grocery store to make ends meet.

Handing out fliers hawking avocados and pork ribs at a supermarket in Ben Lomond, California, Thiermann is one of many facing dramatic lifestyle changes after losing their savings in Madoff's suspected $50 billion Ponzi scheme.

Thiermann wasn't even aware he had invested with Madoff until December 15, when a friend who managed his investments called him on the telephone. "He said, 'I've lost everything and you have lost everything.'" For Thiermann, that meant $750,000.

Days after the release of a list of thousands of Madoff customers -- from Hall of Fame baseball pitcher Sandy Koufax to actor John Malkovich -- a picture is emerging of a scandal that has reverberated far beyond America's still-wealthy to those who have lost nearly everything.

And swept up in the pain are many who should be savoring the twilight of their lives in peaceful retirement rather than scrambling for a living.

Thiermann, owner of a pest-control company in Los Angeles before retiring 25 years ago, enjoyed returns of 10 to 12 percent each year on his savings for about 15 years regardless of whether markets rose or fell. He lived on those returns, devoting much time to nonprofit work.

"We don't have any cash reserves now. And we still owe money on our houses," he said in a telephone interview. He learned of his losses while shopping in a local grocery store with his wife, Terry.

"The store manager who we know very well said, 'What's wrong?' We said, 'Have you heard about this Madoff?' And he said, 'Oh my god!" Thiermann explained. "I now work there as a beginner and I deeply appreciate it."

About 2,490 miles to the east in West Chester, Pennsylvania, Maureen Ebel has also surrendered a comfortable retirement, and works as a cleaner after losing her family savings of $7.3 million to Madoff.

On December 17, six days after learning of her losses, the 60-year-old widow found work cleaning the home of a friend and caring for a 93-year-old woman. Ebel's husband, a doctor, died in 2000 at age 53. The former nurse is also selling her luxury Lexus SUV and a winter home in Florida.

"I HELD ONTO MY DOG AND I CRIED"

"On the first day I went to work, after pushing that vacuum cleaner around, I came home and said to myself 'this is what my life has come to,' and I held onto my dog and I cried," Ebel said in a telephone interview.

In Pompano Beach, Florida, 73-year-old Irwin Salbe also expects to return to work after losing about 75 percent of his investment portfolio to Madoff, who according to court documents confessed to his sons on December 10 that the firm's investment-advisory business was "basically a giant Ponzi scheme."

Such schemes use money from new investors to pay distributions and redemptions to existing investors.

Salbe said his family investments with Madoff date back to the 1960s, although he declined to say exactly how much.