Clare Bronfman, the heiress to the Seagram’s fortune, has been sentenced to almost seven years in jail for her role in the Nxivm sex cult. Bronfman served on the board of the self-help and executive coaching organization that allegedly fronted a sex-trafficking ring, and was a member of the group for over 15 years. She pleaded guilty last year to charges of conspiracy to conceal and harbor aliens for financial gain as well as credit card fraud and was taken into custody immediately following her sentencing this week to begin serving her time.
Despite pleading guilty, Bronfman has refused to denounce the group’s leader, Keith Raniere, who faces sentencing later this month on charges that include the sex trafficking of children. She also denies having knowledge of DOS, the subgroup of Nxivm that branded women with Raniere’s initials and allegedly forced them into having sex with him. Bronfman went as far as to tell the judge before her sentencing that Raniere and Nxivm “changed her life for the better.”
Bronfman is a clear and unfortunate example of someone who inherited vast sums of money with no clear, ethical guardrails around how to use her fortune. Though not directly involved in Raniere’s crimes, she’s responsible for bankrolling the group’s operations, which in turn allegedly enabled Raniere to commit heinous crimes. Judge Nicholas G. Garaufis took note of her role, stating that her “crimes were not committed in a vacuum.” Bronfman also shelled out money for lawyers to protect the group when legal action was taken against it and is said to have repeatedly used her money and status to intimidate victims.
Was Disinheritance an Option?
Her late father, Edgar Bronfman Sr., had been concerned about his daughters' (his other daughter, Sara, was also involved with Nxivm) involvement with the group, and was quoted in a Forbes article saying “I think it’s a cult.” According to the The New York Times, it’s also alleged that Bronfman turned against her father after his accusation and “installed malware on [his] computer, giving Mr. Raniere access to her father’s email account for years.”
A philanthropist known for his contributions to many Jewish causes, Bronfman Sr. must be rolling in his grave. It’s hard to say if he made any mistakes with the disposition of his money or whether he could have foreseen just how troubled and deeply involved Bronfman would become, and just how much of the family fortune would be invested in the pyramid scheme. He did, however, have an inkling of the influence Raniere had over his two daughters and the family’s money, with a 2010 Vanity Fair story reporting that Bronfman Sr. had considered having his daughters “declared incompetent in an effort to protect their assets and pry them away from Nxivm” but ultimately decided against it because he didn’t want the stigma of that attached to them and the family.
Bronfman Sr. had joined the Bill and Melinda Gates’ Giving Pledge back in 2012 and had likely left a large sum of the family fortune toward charitable causes. It’s unclear whether he was somewhat naïve or dismissive of the red flags, or perhaps there just wasn’t enough indication for the need to completely disinherit his daughters or to put some sort of restrictions on their inheritance in place.
According to Harvey I. Bezozi, a federal and state tax resolution expert at YourFinancialWizard.com in Boca Raton, Fla., “If Bronfman’s inheritance was placed in an inherited lifetime trust or a discretionary lifetime trust, the distributions she received would have been subject to the approval of the designated trustee (who would have been assigned by her father). This may have prevented her from using those funds for other than esteemable purposes.”
This case once again highlights the vulnerability of heirs that come into substantial sums of money and the need for careful planning, as well as having the right trustees in place.