Wednesday, May 13, 2009

Madoff Bankruptcy Trustee Sues Charity that Invested with Madoff

The Boston Globe reports that Trustee Irving Picard, who is overseeing the liquidation of Bernard Madoff's assets, has sued the Picower Foundation and several related entities that made nearly $7 billion by investing with Madoff.  According to an earlier New York Times article, the Foundation was at one point the 71st largest foundation in the nation and funded programs to promote justice, equality, human dignity, and tolerance.  It was forced to close its doors, however, when Madoff's Ponzi scheme collapsed.  The lawsuit alleges that the foundation's founders, Jeffrey Picower and his wife Barbara, and the Foundation "knew or should have known that they were benefiting from fraudulent activity or, at a minimum failed to exercise reasonable due diligence."  The suit is part of a larger effort by the Trustee to recoup money from successful Madoff investors, including those that withdrew funds before the collapse.  For additional coverage, see this Fox News story.  For a copy of the complaint, along with other court filings by the Trustee, see this court filings list (the complaint against the Picower Foundation is listed by its filing date of 05/12/2009).

LHM

http://lawprofessors.typepad.com/nonprofit/2009/05/madoff-bankruptcy-trustee-sues-charity-that-invested-with-madoff.html

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