How Bernard Madoff stole their wealth and their dreams.

Lawrence Velvel, 69, dean of the Massachusetts School of Law

Velvel started investing with Bernard Madoff in 1995. He says that after carefully assessing the risks, he opted in for two reasons: "One was that I was told that his returns were quite steady and reasonably good. And the other was that the SEC had announced there was no fraud [after investigating Madoff feeder fund, Avellino & Bienes]."

In addition, Velvel met with Madoff's right-hand man, Frank DiPascali, who "explained precisely this split-strike conversion strategy. And I must say that, until [Harry] Markopolos blew the whistle on certain aspects of that strategy, it seemed to make incredible sense to me. … Madoff was swinging for singles, not to hit home runs."

Like many Madoff investors, Velvel believed he was joining an exclusive, small-scale operation. And he saw positive yearly returns over the following 13 years -- although he's quick to point out he suffered some monthly losses.

When news broke of Madoff's deception, Velvel began reading up on everything he could find. And what he perceived -- mainstream media's interest in Madoff's wealthy investors -- angered him.

"Nobody seems to be focused on what could be done to help people who struggled to reach the middle class, saved, did what you're supposed to do in America under our capitalist system, and then suddenly find themselves wiped out in their old age and destitute because of government complicity."

Velvel took to writing about his experiences, frustrations and findings on his national affairs blog.

When he spoke to FRONTLINE, Velvel refused to disclose how much money he'd lost. He wasn't shy, however, about critiquing the government for their inaction. He said there could only be three explanations for such a vast fraud: "One, incompetence and negligence to an extent never dreamed; two, the SEC, or relevant personnel of the SEC, were in some way on the take; … and the third possibility, Madoff was such a big deal in the industry that the people at the SEC might intrinsically, automatically disbelieved anything said about him, no matter how much proof is presented to them."

When FRONTLINE asked him if he had a message for Madoff, Velvel responded with a chuckle: "I don't think I could say on television what I would like to say to Bernie Madoff."

Bette Greenfield, 71, retired event planner for Merrill Lynch

Her dad, a former CPA who retired to West Palm Beach, Fla., invested all his savings with Bernard Madoff in the 1990s, and he lived off the interest until he died, in 2003. He left the balance -- nearly $400,000 -- to Greenfield and her two brothers, urging them to keep it with Madoff.

For all three children, the inheritance was their nest egg. "We didn't work in places that had pension funds and 401(k)s, and so we really didn't have any money," says Greenfield.

And it seemed a sure bet with Madoff.

"My father was told that this is the man that really knew how to keep his money safe," she says. "He never met Bernie Madoff, but ... he kept telling us: 'This man has a stellar reputation. He's brilliant.'"

She recalls how her father meticulously pored over the stock order confirmations from Madoff's firm. "He checked every one of them against the statement with his little checkmark, like an old-fashioned accountant would do."

While he couldn't figure out how Madoff made such consistent returns, he wasn't suspicious, she says. "My father -- an accountant, and a very smart man -- was dumbfounded, amazed, and had just such admiration."

The three children didn't touch the account for five years. Then, in September 2008, they began withdrawing interest. The plan was to "just take out a little bit every quarter," explains Greenfield. "But we never made it to the next quarter."

She says she found out about the fraud on the day the story broke, Dec. 11, 2008, when her brother e-mailed her an article from The Wall Street Journal. In disbelief, she called her son, a newspaper editor. "I really was like in shock, nonbelieving shock. This couldn't have happened. This didn't happen. This is -- oh my God, what am I going to do?"

Since then, Greenfield has been interviewed by People, The New York Post, USA Today and Reuters. Greenfield attributes the press attention to the fact that she was not a wealthy investor. "The big money, you can't really relate to. But you can relate to somebody just like you that's going to have to figure out what happens next."

For Greenfield, what happens next is not going back to work -- "Young people can't get jobs. How are people my age going to get a job?" -- but turning her hobby of making bracelets and watchbands into an online business. According to her Web site she plans on calling the line, "Look like a million even if you lost it all to Madoff."

Burt Ross, 64, former mayor of Fort Lee, N.J.

Ross liquidated most of his commercial real estate holdings in 2005 and put a good chunk of the money directly into Bernard Madoff's fund. Over time, he sent Madoff $2 million. Why? Because Madoff had been recommended by a friend, whom Ross describes as "one of the wealthiest people in the country."

"The approach was -- this is a guy who will make you a steady return of roughly 12, maybe 14 percent a year. ... And so, that's why you put your safe money there."

Getting into Madoff's fund was like getting into Harvard, he says. "It took pull. My friend had to call somebody, ... and he reached Madoff in Europe. And I got papal dispensation. This is part of the scam. I mean, you have to understand, this was a genius. The harder it was to get in, the more you wanted to get in."

Ross admits there were times when his returns seemed too good to be true.

"There was a month where he had bought all these blue chip stocks, and the day after the transactions, the market crashed. Every one of these stocks went way down. And I said to my wife, Joan, 'This is going to be a bad month.' And we were up 1.5 percent that month. I shook my head and said, "Boy, he must have done something with calls and puts. I don't know what he did, but that was amazing.' ...

"But, again, you get involved in wishful thinking. What's the alternative? The alternative is that it's all a scam on a scale the likes of which we have never seen before. That's hard to fathom."

Plus, there was Madoff's reputation, says Ross. "This also was the [former] president of the Nasdaq stock exchange. I mean, you're not talking about some guy that didn't have a reputation."

Ross says that in only three years, the $2 million he'd invested with Madoff grew to $3 million. Meanwhile, he had separately put $3 million into Ezra Merkin's Ascot Partners LP and Gabriel Capital Corp. And they were doing fine, too.

What Ross didn't know was that the Merkin funds were big Madoff feeder funds.

Today, says Ross, compared to Madoff, he's got a lot more respect for the mobsters who, back when he was mayor, attempted to bribe him -- even threatened to kill him.

"Bernie Madoff is a scam artist. ... Being on boards of charities and giving to charity -- everything he did was to cloak himself with the air of respectability. Dickens couldn't come up with a better name for this guy -- Madoff. He made off with everybody's money."

Joan, 75, and Arnold Sinkin, 76, retired carpet salesman

The Sinkins got involved with Bernard Madoff in the early 1970s because their family accountant was Michael Bienes, who worked for Madoff's father-in-law and was recruiting investors for Madoff's investment advisory business.

"Somewhere along the line, [Bienes] said to my uncle: 'I know you don't have much money. I can really get you an investment that's going to do very well. … This is a really good, safe investment.' And before long, there were probably about 18 to 20 people involved with Bienes."

So Bienes and his partner in the firm, Frank Avellino, funneled the money on to Madoff, taking for themselves a small cut off the top.

But after an SEC investigation in 1992 shut down Avellino & Bienes for not being licensed to sell securities, the Sinkins say Michael Bienes encouraged them to continue to invest with Madoff.

Before investing, Joan called Bernard Madoff. "He came right to the phone, very friendly. … And he explained that he makes purchases from the S&P 100 list." Their regular contact person was Madoff's right-hand man, Frank DiPascali, whom the Sinkins describe as "difficult" and "arrogant," uninterested in engaging their questions. Yet for 34 years, the couple saw positive returns on their dividends each month, and so they stayed with Madoff. The Sinkins used the money to send their children to college and to retire to Boynton Beach, Fla.

Then the news of Madoff's colossal fraud broke on Dec. 11, 2008.

"We both reacted really funny that night, because we had this friend that was very dear, we were going out with her for her birthday," says Joan. "And we never said anything. And then we came home and collapsed in each other's arms." The couple told the New York Daily News that they lost close to $1 million, 85 percent of their life savings. Many of their relatives also lost considerable sums.

So who's at fault?

The government, according to Arnold. "I can't understand how a scheme of this caliber has gone unnoticed in the financial industry. I'm shocked." Joan adds, "The name Bernie Madoff turns up in all positive ways in the financial circle. You don't feel duped, you feel that you were crossed, that the government crossed you. … There were so many people that could have stopped this so long ago."

Meanwhile, the Sinkins commiserate with friends and family who invested with Madoff. "I just saw [my ophthalmologist] from Long Island," Joan tells FRONTLINE. "He lived in Boca. He had a lovely home there. And he lost $4.5 million, all his money he had put in with Madoff. … He took in 33 people, including daughters, in-laws and all, and they've been wiped out. And children can't go back to college because they don't have the money. We're not talking about multimillionaires. We're talking about people that worked all their life."