Thursday, October 27, 2011

Madoff's Family may keep about $82 Million under Mets ruling


Ruth Madoff 
Bernard L. Madoff’s family would keep about $82 million of “other investors’ money” under a ruling that limited a bankruptcy trustee to claiming from the owners of the New York Mets only two years of withdrawals from the Ponzi scheme, according to a court filing.

The confidence man’s family took out $141 million in the six years before Madoff’s firm went bankrupt in 2008, of which less than $59 million was taken in the two years before the bankruptcy, trustee Irving Picard said in a filing. Many other investors are trying to hang onto “stolen” money from fictitious trading that belongs to customers who took losses in the fraud, he said.

Picard wrote about the Madoff family in court papers filed after U.S. District Judge Jed Rakoff told him to explain why another investor, James Greiff, shouldn’t keep money he says he took “in good faith” from the Ponzi scheme. Rakoff’s Madoff caseload includes Picard’s suits against the Mets owners and Greiff.

The trustee’s argument “is good for two reasons,” said Nancy Rapoport, a bankruptcy-law professor at the University of Nevada, Las Vegas, in an e-mail. “It puts the amount of money at risk front-and-center, and it explains how easy it would be for people to hide behind fake securities transactions to circumvent bankruptcy law.”
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