June 15 (Bloomberg) -- A vintage Aston Martin automobile previously owned by Peter Madoff, brother of Bernard L. Madoff, will be sold at auction to help pay the jailed con man’s former investors.
Irving Picard, the trustee liquidating Bernard Madoff’s firm in New York, today won permission from U.S. Bankruptcy Judge Burton Lifland to sell the car, a law clerk for the judge said. Bernard Madoff’s U.K. firm bought the 1958 Aston Martin MK III Drophead Coupe for Peter Madoff in 2008 for $267,000 and wasn’t reimbursed for the expense, Picard said in a court filing.
RM Auctions will sell the Drophead Coupe at the Monterey Auction in California in August. The Blenheim, Ontario-based car-auction company last year sold a 1958 Drophead Coupe for $330,000, compared with an estimate before the sale of $300,000 to $400,000, according to an RM Auctions catalog.
“The price paid in 2008 would relate to a very nice example” of the Drophead Coupe, said James Knight, a car specialist at Bonhams, a London-based auction house. “The market has moved upward for these cars since.”
Asked if the Madoff name would hurt or help the price, Knight said, “I can see some bidders liking the idea in a ghoulish way. If it were me, I’d bid on the merits of the car and I’d not particularly want to brag about the Madoff provenance.”
As many as 3,500 people attend the vintage sports car event in Monterey, Picard has said.
The Madoff car isn’t yet showing on RM Auctions’ preliminary catalog for the Monterey sale on its website. Featured lots include a 1970 Porsche 911S delivered to late actor Steve McQueen on the set of the motorsport movie, “Le Mans,” according to the website.
RM Auctions will post details of the Madoff car on its digital catalog “mid next month,” said Amy Christie, a spokeswoman for the auction company. Charles Spada, a lawyer for Peter Madoff, has declined to comment on the pending auction.
Peter Madoff, sued by U.K. liquidators in 2009 for allegedly enriching himself unjustly by taking the Aston Martin, transferred ownership of the car to Picard on May 4, the trustee said in a filing. It is being auctioned with agreement from the U.K. liquidators, Picard said.
Picard has sought a total of $198.7 million from Peter Madoff and other members of Bernard Madoff’s family, including his son Mark, who committed suicide in December, and niece Shana Madoff Swanson, who had jobs at the defunct firm, according to court documents.
Peter Madoff was chief compliance officer at Bernard L. Madoff Investment Securities LLC. He was among those to whom Bernard Madoff confessed shortly before his arrest, according to Ira Sorkin, a lawyer for Bernard Madoff. Peter Madoff also co-signed Bernard Madoff’s $10 million bond following the money manager’s arrest.
Liquidators of the U.K. firm previously said a 1964 Aston Martin was delivered to Peter Madoff at his residence in Palm Beach, Florida, in 2008. The U.K. firm, Madoff Securities International Ltd., wire-transferred about $200,000 to Gaydon, England-based Aston Martin to buy the car for Peter Madoff, they said in court documents filed in 2009.
Picard has recovered about $7.6 billion for investors who lost more than $17 billion in the Ponzi scheme, although most of it isn’t yet available for distribution, he has said. He and his law firm, Baker & Hostetler LLP, charged more than $175 million for their work, according to court filings.
The main case is Securities Investor Protection Corp. v. Bernard L. Madoff Investment Securities LLC, 08-ap-1789, U.S. Bankruptcy Court, Southern District of New York (Manhattan).
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