Swindler says Madoff lost prisoners' investments too

Swindler says Madoff lost prisoners' investments too
BY ANTHONY M. DESTEFANO | anthony.destefano@newsday.com
January 31, 2009
Sometimes you can't make this stuff up.

On second thought, maybe you can.

A convicted swindler doing time in federal prison for mail fraud saw his attempt to get a piece of accused scammer Bernard Madoff's cash reined in by a Manhattan federal bankruptcy judge Friday.

Jonathan Lee Riches, 32, filed court papers - actually a handwritten, one-page document - alleging that he and fellow inmates at the Williamsburg Correction Center in South Carolina lost their "prison funds" when they invested with Madoff for 16.8 percent interest, only to see them go to a "Swiss account Ponzi."

Riches is a well-known serial litigator and a number of federal judges who have dismissed his complaints against all sorts of luminaries, both alive and dead, have noted he has filed more than 1,000 federal court actions. One federal judge in West Virginia said in dismissing a complaint last year that Riches' allegations of being in imminent physical danger in prison were "irrational and wholly incredible."

In the Madoff case, Riches alleges he met the financier at the online site eharmony.com and had an intimate relationship.

"He was attracted to the fact that I did identity theft and fraud for a living," said Riches in his papers filed in bankruptcy court. "I taught him [Madoff] my skills for 2 years."

But Bankruptcy Judge Burton Lifland said in a ruling Friday that Riches didn't have any right to intervene in the case, being supervised by the Securities Investor Protection Corp. Lifland said the current trustee, Irving Picard, could protect any interests Riches has.

Madoff, who is accused of bilking investors in a $50-billion Ponzi scheme, is out on $10-million bail and is under house arrest at his Upper East Side apartment. One of Madoff's attorneys, Ira Sorkin, declined to comment Friday.