No elderly Jewish victim of Bernard Madoff who made money from his Ponzi scheme will be asked to sell her diamond engagement ring or home in order to repay the fictitious profits made, according to the trustee liquidating Madoff’s investment firm.
“No, that is not what we’re looking for,” said the trustee, Irving Picard. “Those type of people sound like they should be filing hardship applications.”
Asked how much money he would leave retired elderly victims to live on, Picard told The Jewish Week in a conference call with reporters that he could not generalize.
“We have to see all the information from people,” he explained. “They have to come forward and give it to us. We will then review all the factors and make a decision.”
Picard said he has filed more than 1,000 lawsuits in 30 countries to collect $100 billion from individuals and entities that had withdrawn more money than they invested with Madoff. Investigators believe Madoff’s Ponzi scheme — the largest investment fraud in U.S. history — began in 1983 rather than a decade later as Madoff insists, according to Picard’s lawyer, David Sheehan.
“I prefer to negotiate rather than litigate [these lawsuits],” Picard said. “We understand some of the individual customers have extenuating circumstances and that returning all the funds may present a hardship for many, not all. I have broad discretion. Two hundred customers previously qualified [as hardship cases] and I did not sue [them]. Since November, I have gotten 95 hardship applications and have dismissed some of them.”
“The hardship program is working well, but I can only help if the people come forward and provide me with information,” Picard added. “We have made every effort to demonstrate compassion while fulfilling our responsibilities under the law.”
Sheehan said that to date $10 billion has been recovered — half of the money people are believed to have invested with Madoff — and that he hopes to win court approval next month to begin returning a portion of the $2.6 billion in cash and its equivalents currently available before the end of the year. The rest of the $10 billion cannot be distributed because of legal challenges.
Madoff, 72, is serving a 150-year prison sentence after admitting to cheating friends, charities and institutional investors in a scheme that unraveled in December 2008. Friends of Madoff in the Jewish community were particularly hard hit, both in the New York area and in Florida, where Madoff owned homes. Hadassah: The Women’s Zionist Organization and Yeshiva University were among the Jewish institutions that had invested with him.
Picard and Sheehan declined to discuss any pending litigation. But among those fighting the trustee is New York Mets Owner Fred Wilpon, team President Saul Katz and Chief Operating Officer Jeff Wilpon, the owner’s son. The trustee is seeking $300 million he claims they received in fictitious profits.