Indictment Deadline Approaching for MadoffMar 5, 2009 | Parker Waichman LLP Former chairman of the Nasdaq stock exchange and accused Ponzi scammer Bernard Madoff is pending an indictment decision, reported Newsday. Madoff, who is awaiting a decision on indictment or plea bargain, has to tough it out until his next court date, scheduled for March 13, the newest deadline in which prosecutors can seek an indictment or hold a preliminary hearing based on the December 11 federal filing.
Many believe that the notorious scammer might be awarded a plea deal in the massive $50 billion dollar scandal, said Newsday. As of yesterday, Madoff agreed to give up ownership of his businesses, artwork that belongs to his investment firm, and entertainment tickets. According to a report on Reuters.com, the trustee liquidating the accused Ponzi schemer’s assets asked a judge that he be allowed to take over ownership of the property. Presumably, the assets would be sold and the proceeds divided up among Madoff’s defrauded former clients.
Yesterday, a special court hearing over a potential conflict of interest between Madoff and his attorney was postponed mere hours after it had been requested by federal prosecutors in Manhattan, said Newsday, who added that a federal court official said it was adjourned without a new date. Under federal law, prosecutors must receive an indictment or hold a hearing by 30 days following arrest. If both sides agree to a 30-day postponement, the decision can be delayed, said Newday, which reported that Madoff and his attorney, Ira Sorkin, have agreed to two postponements and five adjournments, to date.
Madoff was the founder and primary owner of Bernard L. Madoff Investment Securities LLC. and also oversaw an investment-advisory business that managed money for high-net-worth individuals, hedge funds, and other institutions. According to the FBI complaint against Madoff, that business was largely a Ponzi scheme. The FBI said Madoff “deceived investors by operating a securities business in which he traded and lost investor money, and then paid certain investors purported returns on investment with the principal received from other, different investors, which resulted in losses of approximately millions of dollars.”
Sorkin's parents had money with Madoff, but Sorkin claims he never personally had any investment, which is presenting the potential conflict, said Newsday. Manhattan defense attorney Charles Ross noted that, "It has to be dealt with, it is not something that can be swept under the rug," quoted Newsday. Such a conflict could be used Madoff later to fight any possible conviction.
And, while Madoff agreed to surrender some assets, he is still trying to hold on to his luxury penthouse apartment in Manhattan, where he currently lives under house arrest, as well as $45 million in municipal bonds and $17 million in cash. As we reported earlier this week, Madoff’s lawyers have asserted that those assets belong to his wife Ruth, who has not been accused of any wrongdoing.
One lawyer who represents about 100 investors told the Associated Press they won’t stand for Madoff holding on to so much wealth. “Bernie Madoff has no shortage of chutzpah to suggest as he does that his wife was not the beneficiary of his fraud. It is not only senseless, but offensive,” the lawyer said, pointing out that Ruth Madoff was her husband’s bookkeeper for a time, and thus may be both civilly and criminally culpable for his fraud.