Parker Waichman LLP

Madoff Liquidator May Go After Charities’ “Profits”

Irving Picard, the court-appointed trustee charged with liquidating Bernard Madoff’s investment business—Bernard L. Madoff Investment Securities LLC—said he may go after charities to collect “profits” they made from their investments with the admitted scammer. Madoff, 71, was recently sentenced to 150 years in prison for running a massive Ponzi scheme that is estimated to be […]

Irving Picard, the court-appointed trustee charged with liquidating Bernard Madoff’s investment business—Bernard L. Madoff Investment Securities LLC—said he may go after charities to collect “profits” they made from their investments with the admitted scammer. Madoff, 71, was recently sentenced to 150 years in prison for running a massive Ponzi scheme that is estimated to be the largest in history cost investors some $65 billion.

Bloomberg.com reported that Picard could sue those charities that received more money than they invested with Madoff. Picard is legally required to file clawback lawsuits against those investors who profited from the Ponzi fraud, whether or not those investors were aware of the scheme, said Picard, who added that charities are not excused from the “avoidance actions,” according to Bloomberg.com.

“Picard has an obligation to the bankruptcy estate to collect all the assets he can find and in theory he has to treat everyone the same way,” said William Josephson of Fried Frank Harris Shriver & Jacobson LLP, who helped run the New York State Law Department’s Charities Bureau. “The bankruptcy code doesn’t differentiate” quoted Bloomberg.com, between for- and not-for-profit organizations.

To date, Picard has only gone after those charities he believes were aware of the fraud, for instance, attorney and philanthropist Jeffry Picower and his charity, said Bloomberg.com. A number of Madoff investors are in the spotlight including Picower and Stanley Chais.

According to a prior Wall Street Journal report, there is allegedly evidence that both Picower and Chais told Madoff what return they wanted on their investments with him, and their accounts would eventually reflect those returns. Picard who claims that both sought and received better returns than thousands of other Madoff investors sued both Picower and Chais. According to The Wall Street Journal, those suits allege that Chaise received returns as high as 300% from his Madoff investments, while Picower saw returns of more than 100% in 14 instances, reaching as high as 950%. According to Bloomberg.com, Picower and his “affiliates” allegedly received bogus profits of nearly $7 billion dollars over two decades. Chais was sued for about $1 billion.

Picard has said that those investors who took more than they gave, received “more than their fair share,” quoted Bloomberg.com, which noted that in New York state, Picard can legally “claw back” funds removed up to six years prior to Madoff’s arrest this June.

One charity being looked at by the trustee is Hadassah, a Jewish organization that builds hospitals in Israel, explained Bloomberg.com. It seems that, according to someone familiar with the situation, Hadassah invested $40 million with Madoff, but took $130 million in profits, said Bloomberg.com. Of note, Sheryl Weinstein, who was a former chief financial officer who resigned her post in 1997 authored a book published last month in which she alleges she was once a lover of Madoff, reported Bloomberg.com.

Based on how Picard has been handling fraudulent profits in the Madoff scandal, about $90 million of Hadassah’s phony profits could potentially be a target in the trustee’s clawback strategy, which could, in turn, be ultimately returned to duped investors, explained Bloomberg.com.

What Our Clients Say About Us
We have worked with thousands of clients and we appreciate them and their positive reviews. Here are just a few recent client reviews...
5 Star Reviews 150
Hi Tina guys terrific very professional and I thank you guys so much With all your helpful and I will definitely recommend you guys
D. Jimmy Guptar
2 months ago
5 Star Reviews 150
Excellent Company! I am part of the Roundup class action suit and have been very impressed. Lisa Perez is my contact person, she is amazing!!!
Don Torchia
a year ago
5 Star Reviews 150
I’m really satisfied with my experience dealing with Parker and Waichman and especially my attorney, Mathew Hinrichs, along with the support staff (Jacqueline & Theresa). My attorney is very professional and thorough but very approachable. He always returns calls/emails even in the early evening if necessary. His support staff of Paralegals are professional and thorough as well. This law firm gets things done! My confidence in Parker Waichman is very high, and I have been recommending this law firm to others here in Milwaukee by word of mouth. This recommendation will continue.
Daniel Kasten
3 years ago

Why Choose Us to Help You?

We Take Care of Everything
Your situation is stressful enough: Let us take on the deadlines, paperwork, investigation, and litigation. We'll handle every detail so you don't have to worry.
No Recovery = No Legal Fees
We work on a contingency-fee basis, meaning that we only get paid from a portion of your settlement or jury award. If you don't get compensation, you owe us nothing.
Decades of Experience
Your situation is stressful enough: Let us take on the deadlines, paperwork, investigation, and litigation. We'll handle every detail so you don't have to worry.
Respected by Our Peers
Judges, insurance adjusters, and fellow attorneys all speak highly of our skills, and we've earned numerous accolades, including a flawless rating from AVVO.
We Have Many Locations To Serve You
We have the experience and the skilled litigators to win your case. Contact us and speak with a real attorney who can help you.
Long Island – Nassau
Parker Waichman LLP
6 Harbor Park Drive
Port Washington, NY 11050
Long Island – Suffolk
Parker Waichman LLP
201 Old Country Road – Suite 145
Melville, NY 11747
New York
Parker Waichman LLP
59 Maiden Lane, 6th Floor
New York, NY 10038
Queens
Parker Waichman LLP
118-35 Queens Boulevard, Suite 400
Forest Hills, NY 11375
Brooklyn
Parker Waichman LLP
300 Cadman Plaza West
One Pierrepont Plaza, 12th Floor
Brooklyn, NY 11201
New Jersey
Parker Waichman LLP
80 Main Street, Suite 265
West Orange, NJ 07052
Florida
Parker Waichman LLP
27299 Riverview Center Boulevard
Suite 108
Bonita Springs, FL 34134
Nationwide Service
Parker Waichman LLP
59 Maiden Lane, 6th Floor
New York, NY 10038