Irving H. Picard, the trustee for the liquidation of jailed Ponzi schemer Bernard Madoff’s investment firm, has filed 40 lawsuits, 22 of which were filed against relatives of Madoff and his wife, Ruth Alpern Madoff – including his sister and nephew, her sister, and in-laws – and 18 of which were filed against former employees of Bernard L. Madoff Investment Securities and certain of their relatives, and other related entities.
Through the lawsuits, filed in the United States Bankruptcy Court for the Southern District of New York by Picard's law firm, Baker & Hostetler LLP, Picard seeks to recapture approximately $69 million, which he alleges are funds deposited by BLMIS customers, then diverted from BLMIS's investment advisory business and, ultimately, fraudulently transferred to Madoff family members and BLMIS employees. Funds recovered as a result of these actions will be added to the BLMIS Customer Fund, for equitable distribution among eligible customers of the Madoff Ponzi scheme.
“The complaints filed today are a continuation of our recovery efforts against the Madoff relatives and employees who were closest to the center of the fraud and who were, in many cases, among those who benefited most from the Ponzi scheme,” said Picard in a statement. “When added to the previously filed actions against Madoff’s immediate family and other business associates, the aggregate recoveries sought from this group total almost one-third of a billion dollars.”
Among the complaints filed last Friday were lawsuits against Sondra M. Wiener, Bernard Madoff’s sister, and her husband Marvin. The complaint against Sondra Wiener alleges that she enjoyed special privileges and profited for decades from the Ponzi scheme. The trustee further alleges that from the late 1980s through the early 1990s, Ms. Weiner received a guaranteed annual return of at least 20 percent as well as a $1 million loan from BLMIS which she never repaid.
Lawsuits were also filed Friday against Sondra Wiener’s son Charles Wiener, and Charles’s wife Carolyn. Charles Wiener acted as a BLMIS company executive and was intimately familiar with the operations of BLMIS.
Joan and Robert Roman, Ruth Madoff’s sister and brother-in-law, are also named in the lawsuit filings.
The defendants named in the 40 complaints filed Friday collectively held 66 different accounts with BLMIS, through which approximately $30 million were allegedly diverted to Madoff and Alpern family accounts and related entities, and approximately $39 million were diverted to the accounts held by employees, their families and related entities.
“We have been in touch with each defendant and their counsel, seeking a prompt settlement of these claims and an out-of-court resolution,” said Picard. “However, as these attempts have not reached a satisfactory conclusion, we are moving ahead with litigation.”
Previously filed complaints included Bernard Madoff’s brother, sister-in-law, and his two sons, as well as other close Madoff family members and senior employees who allegedly actively participated in the fraud.
Register or login for access to this item and much more
All Accounting Today content is archived after seven days.
Community members receive:
- All recent and archived articles
- Conference offers and updates
- A full menu of enewsletter options
- Web seminars, white papers, ebooks
Already have an account? Log In
Don't have an account? Register for Free Unlimited Access