Madoff Trustee Sues Former Tremont Capital CEO Manzke Over `Stolen Money'

The trustee liquidating Bernard Madoff’s investment firm sued former Tremont Capital Management Chief Executive Officer Sandra Manzke and Maxam Capital Management seeking more than $100 million.

Maxam, which Manzke started after she left Tremont in 2005, invested more than $300 million of investors’ money with Madoff in less than three years, said Irving Picard, the trustee, in a complaint filed today in U.S. Bankruptcy Court in Manhattan. The trustee seeks a return of almost $100 million that Maxam withdrew from Madoff as well as fees the firm received.

“Every dollar the Maxam defendants purportedly earned and every dollar they kept to unjustly enrich themselves, their funds or other investors, was other investors’ stolen money,” Picard said in the complaint.

The trustee yesterday sued Tremont Group Holdings Inc., which he said was the second-largest Madoff feeder fund group. That complaint, which was filed under seal, also named Manzke, Tremont’s founder, according to a press statement.

Manzke didn’t immediately respond to an e-mailed request seeking comment today. Jonathan Cogan, a lawyer who represents Manzke in a separate securities lawsuit against Tremont, didn’t immediately return a call to his office after regular business hours.

The case is Irving Picard v. Maxam Absolute Return Fund, 10-ap-5342, U.S. Bankruptcy Court, Southern District of New York (Manhattan.)

To contact the reporter on this story: Dawn McCarty in Wilmington at dmccarty@bloomberg.net; Edvard Pettersson in Los Angeles at epettersson@bloomberg.net.

To contact the editor responsible for this story: David E. Rovella at drovella@bloomberg.net.

Press spacebar to pause and continue. Press esc to stop.

Bloomberg reserves the right to remove comments but is under no obligation to do so, or to explain individual moderation decisions.

Please enable JavaScript to view the comments powered by Disqus.