Supreme Court Refuses to Hear Appeal From Madoff Victims

$9.82 Billion Recovered Out of Estimated $17.5 Billion Lost

Getty Images

By Reuters

Published June 30, 2014.
  • Print
  • Share Share

Victims of the Ponzi schemes of Bernard Madoff and Allen Stanford, two of the largest in U.S. history, suffered setbacks on Monday as the U.S. Supreme Court refused to hear appeals in two cases seeking to recoup more money for them.

In the Madoff case, the court rejected a request by Irving Picard, the trustee liquidating Bernard L. Madoff Investment Securities LLC, to review the dismissal of his claims against banks he accused of enabling Madoff’s fraud.

Separately, the court rejected a request by Ralph Janvey, a receiver unwinding Stanford’s businesses, to review a ruling that blocked him from pursuing claims against Stanford employees on behalf of the receivership’s creditors, not the businesses themselves.

In both cases, lower courts concluded that Picard and Janvey lacked standing to bring their respective claims.

The Supreme Court did not give reasons for its decisions, which leave intact a June 2013 ruling in the Madoff case by the federal appeals court in New York, and an August 2013 ruling in the Stanford case by the federal appeals court in New Orleans.

Amanda Remus, a spokeswoman for Picard, said the trustee respected the decision in the Madoff case, and will still pursue $3.5 billion of bankruptcy claims against international banks such as Switzerland’s UBS AG and Britain’s HSBC Holdings Plc.

Kevin Sadler, a lawyer for Janvey, said the receiver is disappointed with the decision in the Stanford case, and will continue to press claims on behalf of more than 18,000 victims against those who profited from or aided Stanford’s fraud.

A Ponzi scheme is where early investors are usually paid with money from later investors.

Picard has recovered about $9.82 billion for former Madoff customers, who he has estimated lost $17.5 billion of principal in a decades-long fraud uncovered in December 2008.

The trustee has also sued banks including JPMorgan Chase & Co, which was Madoff’s main bank, and Italy’s UniCredit SpA over their dealings with the swindler.

JPMorgan was dropped from the case after reaching a $325 million settlement with Picard in January, part of a $2.6 billion global resolution of federal and private claims.

Stanford’s estimated $7.2 billion fraud was based on the sale of bogus certificates of deposit issued by Antigua-based Stanford International Bank to customers who thought the CDs were safe. The Ponzi scheme was uncovered in February 2009.

Janvey won court approval for an initial $55 million distribution to CD investors in April 2013.

Madoff, 76, is serving a 150-year prison term after pleading guilty in March 2009. Stanford, 64, is serving a 110-year term following his jury conviction in March 2012.

The cases are Picard v. JPMorgan Chase & Co et al, U.S. Supreme Court, No. 13-448; and Janvey v. Alguire et al, U.S. Supreme Court, No. 13-913.


The Jewish Daily Forward welcomes reader comments in order to promote thoughtful discussion on issues of importance to the Jewish community. In the interest of maintaining a civil forum, The Jewish Daily Forwardrequires that all commenters be appropriately respectful toward our writers, other commenters and the subjects of the articles. Vigorous debate and reasoned critique are welcome; name-calling and personal invective are not. While we generally do not seek to edit or actively moderate comments, our spam filter prevents most links and certain key words from being posted and The Jewish Daily Forward reserves the right to remove comments for any reason.





Find us on Facebook!
  • "I am wrapping up the summer with a beach vacation with my non-Jewish in-laws. They’re good people and real leftists who try to live the values they preach. This was a quality I admired, until the latest war in Gaza. Now they are adamant that American Jews need to take more responsibility for the deaths in Gaza. They are educated people who understand the political complexity, but I don’t think they get the emotional complexity of being an American Jew who is capable of criticizing Israel but still feels a deep connection to it. How can I get this across to them?"
  • “'I made a new friend,' my son told his grandfather later that day. 'I don’t know her name, but she was very nice. We met on the bus.' Welcome to Israel."
  • A Jewish female sword swallower. It's as cool as it sounds (and looks)!
  • Why did David Menachem Gordon join the IDF? In his own words: "The Israel Defense Forces is an army that fights for her nation’s survival and the absence of its warriors equals destruction from numerous regional foes. America is not quite under the threat of total annihilation… Simply put, I felt I was needed more in Israel than in the United States."
  • Leonard Fein's most enduring legacy may be his rejection of dualism: the idea that Jews must choose between assertiveness and compassion, between tribalism and universalism. Steven M. Cohen remembers a great Jewish progressive:
  • BREAKING: Missing lone soldier David Menachem Gordon has been found dead in central Israel. The Ohio native was 21 years old.
  • “They think they can slap on an Amish hat and a long black robe, and they’ve created a Hasid." What do you think of Hollywood's portrayal of Hasidic Jews?
  • “I’ve been doing this since I was a teenager. I didn’t think I would have to do it when I was 90.” Hedy Epstein fled Nazi Germany in 1933 on a Kinderstransport.
  • "A few decades ago, it would have been easy to add Jews to that list of disempowered victims. I could throw in Leo Frank, the victim of mob justice; or otherwise privileged Jewish men denied entrance to elite universities. These days, however, we have to search a lot harder." Are you worried about what's going in on #Ferguson?
  • Will you accept the challenge?
  • In the six years since Dothan launched its relocation program, 8 families have made the jump — but will they stay? We went there to find out:
  • "Jewish Israelis and West Bank Palestinians are witnessing — and living — two very different wars." Naomi Zeveloff's first on-the-ground dispatch from Israel:
  • This deserves a whistle: Lauren Bacall's stylish wardrobe is getting its own museum exhibit at Fashion Institute of Technology.
  • How do you make people laugh when they're fighting on the front lines or ducking bombs?
  • "Hamas and others have dredged up passages form the Quran that demonize Jews horribly. Some imams rail about international Jewish conspiracies. But they’d have a much smaller audience for their ravings if Israel could find a way to lower the flames in the conflict." Do you agree with J.J. Goldberg?
  • from-cache

Would you like to receive updates about new stories?




















We will not share your e-mail address or other personal information.

Already subscribed? Manage your subscription.