NEW YORK, Dec. 18 (UPI) -- The Madoff scandal, an alleged Ponzi scheme, touched nearly every segment of New York's real estate world, industry executives say.
The world's largest alleged Ponzi scheme hit brokers of all sizes and prominent development families, as well as lesser known developers, as Bernard Madoff managed his funds in a traditional way -- he provided little information and demanded big trust, The New York Times reported.
Industry executives said deals across the city had been called off or put in peril because of the scandal, and residential brokers are taking calls from Madoff investors who have put their apartments up for sale, as many investors had used their Madoff investments as collateral for other projects, the Times said.
"The level of devastation, both financial and on a human level, is astounding," Robert J. Ivanhoe told the Times. Ivanhoe is a lawyer representing 10 developers and investors who lost $5 million to $50 million each with Madoff.
A Ponzi scheme uses income from new investors to make big payoffs to old investors, but generates no income. Arrested by the FBI on securities fraud, Madoff is under house arrest in New York.