Merkin, N.Y. Reach $410 Million Madoff Lawsuit Settlement

New York settled a lawsuit for $410 million with J. Ezra Merkin over claims that Merkin funds secretly placed more than $2 billion of client money with Bernard L. Madoff.

The agreement provides $405 million to compensate investors and $5 million for the state, according to a statement today by the office of New York Attorney General Eric Schneiderman. In the case, filed in 2009 by his predecessor, Andrew Cuomo, the state claimed Merkin steered assets to Madoff and didn’t disclose Madoff’s role.

Madoff, who pleaded guilty to running a Ponzi scheme that authorities say swindled investors of about $17 billion, is serving a 150-year prison sentence.

The case is People of the State of New York v. J. Ezra Merkin, 450879-2009, New York State Supreme Court, New York County (Manhattan).

To contact the reporter on this story: David McLaughlin in New York at dmclaughlin9@bloomberg.net.

To contact the editor responsible for this story: Michael Hytha at mhytha@bloomberg.net.