Madoff Must Reveal His Remaining Assets
Sunday, December 28, 2008
Investors looking to recoup some of the $50 billion they lost in Bernard Madoff's alleged Ponzi scheme may get a better idea what the New York financial adviser has left when he is forced to reveal his assets to regulators this week.
Madoff, 70, must provide a detailed list of all investments, loans, lines of credit, business interests, brokerage accounts and other holdings to the Securities and Exchange Commission by New Year's Eve, a federal judge ruled earlier this month. Madoff's foreign business units were given until Jan. 26 to provide a similar accounting.
The list is to include all assets held for his "direct or indirect benefit," U.S. District Judge Louis Stanton in Manhattan wrote in his order in the SEC lawsuit. It must describe "the source, amount, disposition and current location of each of the items listed."
A catalog of Madoff's assets may reveal targets for angry investors, including hedge funds and charities seeking the return of their funds. New York-based Bernard L. Madoff Investment Securities began liquidating after his Dec. 11 arrest for securities fraud. Madoff, under house arrest in his Manhattan apartment, faces as much as 10 years in prison and a $5 million fine if convicted.
Several investors have filed suits against Madoff and his firm following FBI allegations that he admitted the business was "one big lie." Investment firms that did business with Madoff also have been sued.
Federal prosecutors allege Madoff engaged in a classic Ponzi scheme in which he would pay off old investors with the money of new investors. His lawyer, Ira Sorkin, didn't return a call Friday seeking comment, although he said previously that his client is cooperating with the government.
Madoff, who hasn't formally responded to the securities fraud charge, is due in court Jan. 12, unless he is indicted before then. Prosecutors and defense lawyers also may agree to postpone the court date.