Peter Madoff Refuses to Answer Questions in London LawsuitKit Chellel
Bernard Madoff’s younger brother, repeatedly refused to answer questions in a lawsuit filed by the liquidators of Madoff’s U.K. unit seeking $50 million from the convicted conman’s family and associates.
Peter Madoff, testifying via a video link from a U.S. prison, told the London court that he would invoke his U.S. Fifth amendment right against self-incrimination. He refused to discuss payments totalling $300 million from the U.K. unit to his brother’s family, his own plea bargain to U.S. criminal charges, and his duties at the company’s U.K. unit.
Madoff Securities International Ltd. in London was owned almost exclusively by Madoff and served as his proprietary trading unit. More than $910 million was transferred between the London unit and Bernard L. Madoff Investment Securities LLC in New York from the time of the office’s founding in 1983 until firm’s collapse in December 2008, the liquidators said when they filed the lawsuit in 2010.
The 67-year-old Peter Madoff, dressed in a dark jacket, answered a few questions before invoking his U.S. Constitutional rights. He confirmed the U.K. liquidators had dropped him as a defendant in the case as one of the directors of the London unit. He also said that the U.K. company was set up to expand the U.S. trading business in Europe.
The defendants -- including Bernard Madoff’s son Andrew, former Bank Medici AG chairwoman Sonja Kohn and 75-year-old former SG Warburg executive Stephen Raven -- deny knowing of any wrongdoing and say they too are victims. Liquidators are seeking to recover about $50 million, including payments for a luxury yacht and an Aston Martin sports car.
Bernard Madoff, 75, is serving a 150-year sentence for what prosecutors said was the biggest Ponzi scheme in U.S. history. Liquidators of his companies have sued banks, feeder funds, and Madoff’s employees to recover some of the $17 billion lost by victims.
Ponzi schemes use funds from new investors to pay artificially high returns to existing ones. Without a genuine source of income, they can collapse without new customers or if investors start withdrawing money.
Irving Picard, the U.S. trustee appointed to liquidate Madoff’s assets in 2008, has described Madoff Securities International as a “critical piece of the facade of legitimacy that Madoff constructed.”
The case is Madoff Securities International Ltd. v. Raven, 10-1468, High Court of Justice, Queen’s Bench Division (London)