The family of David M. Becker, the former top lawyer for the U.S. Securities and Exchange Commission, agreed to pay $556,017 to settle claims over inherited money that was linked to Bernard Madoff’s Ponzi scheme.
The payment is equal to the entire amount of profits that Becker and his brothers inherited from a Madoff account held by their mother, who died in 2004, according to a statement today by Amanda Remus, a spokeswoman for Irving H. Picard, the trustee liquidating Madoff’s firm.
Picard, in a November 2010 lawsuit filed in bankruptcy court in New York, had originally claimed that the Beckers received $1.5 million in fictitious profits.
Becker, who left the SEC in 2011 to return to private legal practice, faced criticism last year after Picard’s lawsuit was made public, suggesting he may have had a personal financial interest in policies he worked on at the SEC related to how Madoff customers should be compensated.
William Baker III, Becker’s attorney, said in an e-mailed statement today that Becker made full disclosure of his mother’s account while he was at the SEC and followed the agency’s ethics procedures.
The SEC’s inspector general called for the Justice Department to investigate whether Becker violated ethics laws. Federal prosecutors declined to open a case.
‘Unaware’ of Account
Becker “was unaware of his mother’s account until long after it was liquidated and he always expected that he would return any fictitious profits that he unknowingly received,” Baker said. “Mr. Becker has done everything possible, both at the SEC and in his private affairs, to assist the victims of the Madoff fraud.”
In the statement today, Remus said the trustee believes that this settlement represents the best possible outcome for Madoff customers. The agreement is subject to court approval and a hearing on the matter is currently scheduled for April 3.
Becker, 64, worked as a clerk for former U.S. Supreme Court Justice Stanley Reed after graduating from Columbia University School of Law, where he was editor-in-chief of the law review. He was the SEC’s general counsel from 1999 to 2002 before rejoining the agency in 2009 to be Schapiro’s top lawyer.
Becker is now a partner in the Washington office of the Cleary Gottlieb Steen & Hamilton law firm.