This is a rush transcript from "On the Record," August 28, 2009. This copy may not be in its final form and may be updated.

GRETA VAN SUSTEREN, FOX NEWS HOST: Bernie Madoff's mistress is talking. The mega-swindler is behind bars, convicted of harming investors out of billions of dollars. Well, apparently Madoff also told lies to his wife. He had a mistress, and now she's written a book. Madoff is not going to like this.

Earlier, Sheryl Weinstein went "On the Record."


VAN SUSTEREN: Sheryl, nice to meet you.


VAN SUSTEREN: All right, brand new book, "Madoff's Other Secret." You're the other secret. You talk about what that secret is.

But let's back up for a second first. How did you first meet Bernard Madoff?

WEINSTEIN: Bernie and I met in a business meeting. There was a major French donor, and a part of the stipulation of the gift, which was $7 million at the time, was that it be held by Bernie Madoff and invested by him.

And that's how we met. It was a meeting to figure out the logistics of this investment.

VAN SUSTEREN: In the book you talk about an affair with Bernard Madoff.


VAN SUSTEREN: That did not start in the beginning of your relationship and you had a professional relationship with him.

WEINSTEIN: No. It started off as professional relationship and it went on for five years before it became physical in nature.

VAN SUSTEREN: In the five-year period, were you infatuated with him or interested in him?

WEINSTEIN: He was with me. He made it very clear very soon into the relationship that he would like to take it further. And I made it clear at that point that I was not really into that. I was not into having at affair.

VAN SUSTEREN: You meet this guy, Bernard Madoff, and you have five years when you have a professional relationship. And then all of a sudden one day and night you begin this thing which is a betrayal of your husband.

I'm trying to think, why was it OK? Why did it seem like a good idea to you?

WEINSTEIN: It wasn't OK.

VAN SUSTEREN: At the time, though. It must've been okay at the time because he would have done it. He certainly did, so it wasn't like -- now I understand that you have remorse, but at the time?

WEINSTEIN: At the time, we were having problems in our marriage. My husband was later diagnosed with ADD, and later was medicated and life changed considerably for us after that point.

VAN SUSTEREN: If I asked you in 1995 what's Bernard Madoff like, what would have been your answer then?

WEINSTEIN: He would have been a good friend somebody that two characters financially, help secure future, somebody that if I had a problem, I would feel comfortable calling.

VAN SUSTEREN: And if I ask you -- well, let me ask you now. What do you think now? You have lost personal money, too.

WEINSTEIN: We've lost all of our money.

VAN SUSTEREN: You were wiped out?

WEINSTEIN: Yes. Other than level what we had in her apartment, yes.

VAN SUSTEREN: So what do you think about Bernard Madoff today?

WEINSTEIN: I think I basically said what I felt about him and poured on the day of sentencing. I think he is a beast. I think he should not be among normal human beings, us. I think he should be kept in a cage behind bars. I think that he cared nothing for anybody other than his own needs.

VAN SUSTEREN: Did you think, "I'm in love with this guy"?

WEINSTEIN: No, no. I never felt that I was in love with Bernie, because there was no place for it to go. And so I skipped the "I'm in love" step.

VAN SUSTEREN: Why in the book do you write that you lost your entire fortune but you backed off telling the number?

WEINSTEIN: "Fortune" would be an exaggeration.

VAN SUSTEREN: Well, OK. But you write that you lost what you had. You lost your investment, other family members, the lost her apartment. I mean, you took an enormous financial hit. But you don't say the amount.

WEINSTEIN: Yes, because it really doesn't matter how much you have lost. It matters what you have left. And if somebody loses $100 and it's the last $100, does that make it any more or less important or more important to somebody who has $1 million and loses that million dollars and has nothing left?

VAN SUSTEREN: When you stood in court to make your statement, witness impact statement, at Bernard Madoff's sentencing, did you look at him?

WEINSTEIN: I would have, but his back was to us.

VAN SUSTEREN: So he never turned to look at you?

WEINSTEIN: No, he faced the judge virtually the entire time. He turned once quickly to say he was sorry to a whole group of people.

VAN SUSTEREN: Did you buy it?


VAN SUSTEREN: You don't think he's sorry?

WEINSTEIN: No, I don't.

VAN SUSTEREN: Do you think he's sorry he got caught?

WEINSTEIN: I think he's very sorry he got caught, yes.

VAN SUSTEREN: There are all these stories, I don't know if they are true or not, that he is a sick man. Do you care?

WEINSTEIN: I hope he is not.


WEINSTEIN: Because I want him to lift a long life in prison.

VAN SUSTEREN: In prison.

WEINSTEIN: Yes, I do, painting fences or whatever else he's doing.

VAN SUSTEREN: In your mind, personal piece of you that thinks I feel sorry for Bernard Madoff?

WEINSTEIN: I did at the sentencing because he was all alone. There was a moment -- because he was all alone, and he didn't have a wife there, he didn't have his children their gorgeous brother there. Nobody had written a letter from him. So at that moment there was a bit of pity that I felt.

But the other feelings were overwhelming that little bit of pity I felt.

VAN SUSTEREN: Did you see the picture of the video of Ruth Madoff on the subway after she got out of her apartment, sort of grasping her purse and that's all she had? Did you see that?

WEINSTEIN: Yes, I did.

VAN SUSTEREN: What did you think when you say that?

WEINSTEIN: I don't feel sorry for her. I think there is a part of that may be new, maybe ignored. She benefited from a lot of other people's money.

VAN SUSTEREN: Do you have any reason to know or to think -- any sort of indication that she was part of this or was aware of it and looked to the other way?

WEINSTEIN: I don't have any true knowledge, but if I was to give an opinion, I would say that she looked the other way more.

VAN SUSTEREN: What makes you say that?

WEINSTEIN: Because she was a financial person. She -- I know she worked, she worked with the books. Bernie told me that, that Ruth was -- nothing got by Ruth. And Ruth was involved in this business a long time. And I have a feeling -- anything, but I do feel when everything is said and done this had started a long time ago.

VAN SUSTEREN: How do you think he is doing in prison?

WEINSTEIN: reading that he is going to manage to have some life with himself. He's doing these sweating Indian things, bare shirt (ph), that I read it. But I read it. And yes, I read he had cancer, too. So I don't know how much credibility anyone can put into what we are reading.

VAN SUSTEREN: Do you hate him?

WEINSTEIN: Yes. Yes. He stole my family's life. He stole my dreams. All these people -- he was an equal opportunity destroyer. And it was about him and his needs. And morality and everything else played second fiddle to his needs.


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