It looks like court-appointed Madoff trustee Irving Picard is going after the whole shebang: Not just Bernard Madoff’s Manhattan penthouse and home in the Hamptons, but also a good chunk of the wealth accumulated by his wife, brother and sons.
In his latest filing in U.S. Bankruptcy Court in New York, Picard argues that the convicted swindler used his firm, Bernard L. Madoff Investment Securities (BLMIS), “as his personal piggy bank” to support “a lavish lifestyle” for himself and his wife, as well as for his brother and other members of his family.
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“Madoff used BLMIS to siphon funds which were, in reality, other people’s money, for his personal use and the benefit of his inner circle,” Picard says in the filing submitted Tuesday evening. “Plain and simple, he stole it.”
Picard, who is charged with returning as much money as possible to burned investors, contends that Madoff used money stolen from investors, for instance, to buy country club memberships for himself, his wife and one of his sons.
He also loaned $9 million to his brother, the firm’s chief compliance officer, in 2007, from one of the firm’s accounts, according to the papers. Picard said there is no evidence the loan was ever repaid. Peter Madoff’s wife, Marion, was also listed on the firm’s payroll with a salary of $163,500 in 2008, although there is no indication she did any work.
The firm also gave money to ventures begun by Madoff family members, including $1.7 million to Madoff Energy Holdings LLC, owned by Madoff’s sons Andrew and Mark, and his niece, Shana Madoff, the filing said.
The firm paid out $4.5 million to support Ruth Madoff’s real-estate-related investments through various entities under the name “Sterling,” with no benefit to Madoff’s firm or his customers, according to the papers.
Madoff placed his boat captain, his maid and his house-sitter in Florida on the firm’s payroll, and used the firm to provided corporate credit cards to his son’s wife and brother’s wife, even though they didn’t work for him, according to the filing.
More than $11.5 million was used to buy two yachts for the Madoff family, the filing said. Another $4.4 million appears to have been used by Andrew Madoff last October to purchase an Upper East Side apartment, while $6.5 million was loaned to Mark Madoff and his wife, Stephanie, last spring to purchase property on Nantucket, again with no evidence that any money was repaid.
Bernard Madoff, 71, was arrested Dec. 11 and pleaded guilty March 12 to running a $65-billion Ponzi scheme in which early investors were paid with the money of new clients. He is in jail, awaiting sentencing, and faces as much as 150 years in prison for various counts of securities fraud and other crimes.
Picard made the allegations in connection with his attempt to consolidate the bankruptcy proceedings of Madoff’s companies with those filed against Madoff by a group of investors.
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