Trustee Says He’s Found $75 Million of Madoff’s
Trustee Says He’s Found $75 Million of Madoff’s

Published: March 23, 2009
The trustee handling the liquidation of Bernard L. Madoff’s brokerage business told a federal judge on Monday that he had found $75 million in new assets in Gibraltar. He also said he was monitoring claims against the Madoffs’ chateau in France, and had received clearance from a British court to work with counterparts in London on liquidating the Madoff business there.

But at the same time, the court-appointed trustee, Irving H. Picard of the law firm Baker Hostetler, was meeting stiff opposition from prosecutors in New York.

At a hearing in federal court, representatives of the United States attorney’s office and the Securities and Exchange Commission objected to Mr. Picard’s routine request for power of attorney over Mr. Madoff’s stake in his London business.

That power had been held by an earlier bankruptcy receiver who is stepping down from the case.

David J. Sheehan, the lawyer for Mr. Picard, said that the power of attorney would strengthen the trustee’s position in his dealings with British authorities, who are independently investigating Mr. Madoff’s London activities.

But lawyers for the government argued that it would be premature to transfer the power to Mr. Picard until prosecutors had considered all potential consequences of doing so — for the continuing criminal investigation and for future forfeiture claims. Mr. Madoff pleaded guilty in February to running a vast Ponzi scheme, but prosecutors are still pursuing charges against others.

Judge Louis L. Stanton of United States District Court in Manhattan sharply questioned the government about its reluctance to grant Mr. Picard the power of attorney. “What are you afraid he will do with it?” Judge Stanton asked. He said he would rule on the request promptly.

Moments after he left the bench, some government lawyers and Mr. Sheehan exchanged angry words and parted company, with neither side offering further explanation of the dispute.

Mr. Picard has gathered about $1 billion in assets from the Madoff estate, which is expected to be shared among investors who have lost an estimated $65 billion in the scheme.

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