Mets Owners Aren’t the Only Big Winners in Madoff Ruling
Follow @smoughtsSeptember 29, 2011, 1:00 pm ET
The pool of money for Bernie Madoff’s victims may shrink by as much as $11 billion.
Madoff trustee Irving Picard’s job is to claw back money from investors who profited from the Ponzi scheme to repay its victims. But yesterday, U.S. District Judge Jed Rakoff said that under federal bankruptcy law, Picard can only claim profits from the two years leading up to the December 2008 discovery of Madoff’s fraud. Previously, Picard had calculated based on a six-year window.
The ruling came in a case Picard had filed against Fred Wilpon and Saul Katz, the owners of the New York Mets. Picard was seeking $1 billion from two men, but the judge limited the amount to $386 million.
The decision “could completely upend the Madoff bankruptcy,” writes Reuters’ Alison Frankel:
Another possible winner is Michael Bienes, whose firm funneled money to Madoff’s investment business for decades and gave an unforgettable interview for FRONTLINE’s 2009 film The Madoff Affair. If you saw the film, you’ll remember how he described the early years of investing with Madoff as “easy, easy-peasy, like a money machine.” (If you missed it, start with the above clip.)
Picard was seeking $56 million from Bienes and his former partner, but after yesterday’s ruling the two men would now be facing a $17.2 million clawback claim, writes Frankel.
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