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Madoff Trustee Sues JPMorgan Chase (primary banker sued for billions; facilitated money-launder)
Accounting Today ^ | 24/11 | Michael Cohn

Posted on 02/06/2011 6:25:43 AM PST by Liz

The trustee liquidating Madoff’s asset management firm, has filed a complaint against JPMorgan Chase, claiming the bank had suspicions about Madoff’s Ponzi scheme going back to at least 2006, but waited until 2008 to alert authorities while it earned hundreds of millions of dollars from doing business with Madoff.

The complaint seeks to recover nearly $1 billion in fees and profits, and an additional $5.4 billion in damages, for JPMorgan Chase’s decades-long role as primary banker for Bernard L. Madoff Investment Securities’ (BLMIS), allegedly aiding and abetting Madoff’s fraud.

“Incredibly, the bank’s top executives were warned in blunt terms about speculation that Madoff was running a Ponzi scheme, yet the bank appears to have been concerned only with protecting its own investments in BLMIS feeder funds,” said Deborah Renner, a partner at Picard’s law firm Baker & Hostetler. “As we allege in the complaint, JPMC had a palpable concern that Madoff was a fraud for years, but it was not until October 2008 that it reported Madoff to government officials. Even then, JPMC executives did not restrict the BLMIS bank account, even though it was being used to launder money from the Ponzi scheme.”

The trustee alleges that JPMorgan Chase ignored its anti-money laundering obligations and repeatedly allowed suspicious transactions for high dollar amounts to occur in the Madoff account. The complaint alleges that, as Madoff’s banker for over two decades, JPMorgan Chase had financial reports in its possession that provided clear evidence of fraud and led a prominent fund manager at the bank to conclude that fraudulent activity was highly likely.

Employees at Chase also had concerns about Friehling & Horowitz, the small three-employee accounting firm located in a suburban strip mall in New City, N.Y., that audited Madoff’s lucrative investment management business. “Let's go see Friehling and Horowitz the next time we're in NY,” one of the bankers wrote,.” to see that the address isn't a car wash at least."

It was not until early 2006 that JPMorgan Chase performed even minimal due diligence on Friehling, according to the lawsuit. One JPMorgan Chase employee noted in an e-mail that “a quick check found that they [Friehling] are not registered with the Public Company Accounting Oversight Board, nor are they subject to peer reviews from the American Institute of Certified Public Accountants. Additionally, they have no website to provide background on their organization.”

Another employee noted that the choice of Friehling & Horowitz was an “odd choice” and questioned whether such a small firm was even competent to conduct an audit of an investment firm with “$650m in shareholder capital.”

In 2007, another JPMorgan Chase said he heard from a co-worker at lunch that “there is a well-known cloud over the head of Madoff and that his returns are speculated to be part of a [P]onzi scheme—he said if we google the guy we can see the articles for ourselves—Pls do that and let us know what you find."

JPMorgan Chase said in a statement that the lawsuit "is meritless and is based on distortions of both the relevant facts and the governing law," according to The Wall Street Journal, and claimed it "did not know about or in any way become a party to the fraud orchestrated by Bernard Madoff." In October 2008, JPMorgan Chase filed a suspicious activity report with British authorities to relay some of its concerns about Madoff, but not the SEC.

It said in a filing with the U.K.’s Serious Organized Crime Agency that the claims for Madoff’s investments were “too good to be true—which means it probably is.” Two months later, Madoff confessed the Ponzi scheme to his two sons, calling it “one big lie,” and they alerted US authorities. Madoff is currently serving a 150-year prison sentence.


TOPICS: Business/Economy; Crime/Corruption
KEYWORDS: bernardmadoff; berniemadoff; classaction; deeppockets; jpmorgan; lawsuit; madoff; ponzi; tort Comment #1 Removed by Moderator

To: Liz

The chickens are coming home to roost! :)


2 posted on 02/06/2011 6:44:37 AM PST by Diana in Wisconsin (I don't have 'Hobbies.' I'm developing a robust post-Apocalyptic skill set...)
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To: Liz

Do not make nearly-full text posts into comments - and also include a link with the excerpt.


3 posted on 02/06/2011 6:56:16 AM PST by Admin Moderator
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To: Admin Moderator

OK-—will do.


4 posted on 02/06/2011 7:01:57 AM PST by Liz
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To: Liz

Thanks. After FR’s experience with Righthaven, we need to be careful about proper excerpting and linking, and the comments doesn’t have the same kind of automated monitoring of auto-excerpting that the initial post does.


5 posted on 02/06/2011 7:17:31 AM PST by Admin Moderator
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To: Diana in Wisconsin

“Employees at Chase also had concerns about Friehling & Horowitz, the small three-employee accounting firm located in a suburban strip mall in New City, N.Y., that audited Madoff’s lucrative investment management business. “Let’s go see Friehling and Horowitz the next time we’re in NY,” one of the bankers wrote,.” to see that the address isn’t a car wash at least.”

It was not until early 2006 that JPMorgan Chase performed even minimal due diligence on Friehling, according to the lawsuit. One JPMorgan Chase employee noted in an e-mail that “a quick check found that they [Friehling] are not registered with the Public Company Accounting Oversight Board, nor are they subject to peer reviews from the American Institute of Certified Public Accountants. Additionally, they have no website to provide background on their organization.”

“Another employee noted that the choice of Friehling & Horowitz was an “odd choice” and questioned whether such a small firm was even competent to conduct an audit of an investment firm with “$650m in shareholder capital.”

LOL! The phony CPA was always the biggest red flag. No one at the SEC could drive to New City, NY? Walter Noel the big feeder fund could not jump in the Range Rover and drive down from Greenwich, CT? Too busy getting his daughters in the society pages so their hubbies could keep finding suckers in South America, Europe and Asia.

The phony CPA was a tip off to anyone and everyone. 3 person CPA? Well the old man had retired so it was one CPA. And the younger one rarely showed up. They had one part time lady at the office.


6 posted on 02/06/2011 7:35:58 AM PST by Frantzie (HD TV - Total Brain-washing now in High Def. 3-D Coming soon)
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To: Diana in Wisconsin

Two questions:

1. Did Madoff really pay $1 billion in fees for his checking account at Chase? He must have made a lot of wire transfers, but I think he could have got a better deal than that.

2. Were the investment bankers who decided no to invest in Madoff on behalf of their clients aware that Madoff had his checking account at Chase? After all, they weren’t exactly working in the transaction processing department.


7 posted on 02/06/2011 7:39:04 AM PST by proxy_user
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To: proxy_user
Did Madoff really pay $1 billion in fees for his checking account at Chase? He must have made a lot of wire transfers, but I think he could have got a better deal than that.

Most of that is likely interest and money JPM made from float and investment of deposits.

8 posted on 02/06/2011 7:51:36 AM PST by Poison Pill
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To: proxy_user

Probably, those go fees were paid in excess to insure that these sorts of questions were not asked inside JPM.

This is one of the scandals within the overall scandal, ie, that “reputable” banks and funds knew that Madoff was running a scam, but the amounts they were being paid to do these tasks for Madoff insured their silence.


9 posted on 02/06/2011 8:26:06 AM PST by NVDave
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To: Frantzie

Spot-on. The SEC was too busy watching porn, and the feeder funds didn’t want to know. They were making a pretty penny on this scam as well.

The Madoff scam amply proves that Wall Street has almost no honest actors.


10 posted on 02/06/2011 8:33:20 AM PST by NVDave
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To: NVDave; Diana in Wisconsin; Frantzie; CutePuppy; ken5050; Condor51
ACCOUNTING TODAY EXCERPT The trustee alleges that JPMorgan Chase ignored its anti-money laundering obligations and repeatedly allowed suspicious transactions for high dollar amounts to occur in the Madoff account. The complaint alleges that, as Madoff’s banker for over two decades, JPMorgan Chase had financial reports in its possession that provided clear evidence of fraud and led a prominent fund manager at the bank to conclude that fraudulent activity was highly likely.

LINK http://www.accountingtoday.com/news/Madoff-Trustee-Sues-JPMorgan-Chase-57193-1.html

========================================

POSTER'S ANALYSIS Madoff's assets included a super-secret labyrinth of interrelated international funds, institutions and financial entities of almost unparalleled complexity and breadth......with assets and businesses in multiple places overseas that hid thievery, money laundering and tax evasion.

That serves to underline that Madoff was running simultaneous scams:

(1) a tax evasion scheme for wealthy businessmen ("losing" money is a tax write-off;

(2) a money laundering scam;

(3) a protection racket for affinity groups,

(4) aiding and abetting wealthy tax-exempt foundations to evade US banking laws and the IRS.

(5) hiding money for wealthy businessmen some of which was used for campaign donations (FEC fraud), and foundation fraud (IRS fraud)

Keep in mind Bernie‘s investors were savvy, astute successful business people, accustomed to constructing, picking apart and analyzing financial statements. One investor who spoke to reporters was a stockbroker (her family invested with Bernie for generations---the family's patriarch founded the wildly successful Stop and Shop supermarket chain). Other inevstors gave Madoff $100-500 millions to "invest" for years and years.

Beneath that smiling twinkle is a conniving criminal.

"Hi, I'm Bernie. Trust me."

11 posted on 02/06/2011 11:47:56 AM PST by Liz
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To: Poison Pill; proxy_user

ping to post #11


12 posted on 02/06/2011 11:50:23 AM PST by Liz
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To: Liz; NVDave; Diana in Wisconsin; Frantzie; CutePuppy; ken5050; Condor51

Well, this is an interesting point. Since Madoff was avowedly running a large fund, perhaps it could be argued that the transfer of large sums of money in and out of the account was not suspicious, but rather just what you’d expect with what Madoff claimed to be doing. The AML regulations are mostly designed to spot questionable CASH transactions, which did not apply to this account.

Or maybe Chase did file an SAP with the government. Under Federal law, these reports are confidential and cannot be revealed to anyone. Government regulations define precisely what transactions are considered suspicious, and computerized algorithms running against the transaction database capture them and generate reports. If Madoff’s transactions did not meet these criteria, Chase could argue that by the government’s own definitions there was no suspicious activity in this account.


13 posted on 02/06/2011 12:07:54 PM PST by proxy_user
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To: proxy_user
Except that Harry Markopoulos contacted the SEC several times about Madoff----HM himself had discovered Madoff was using shady math. HM was ignored.

The SEC did nothing. Until Madoff "confessed."

The Accounting Today article reports that the trustee alleges that JPMorgan Chase, as Madoff’s banker for over two decades, had financial reports in its possession that provided clear evidence of fraud and led a prominent fund manager at the bank to conclude that fraudulent activity was highly likely.

(Snicker) As the CIA says---the crooks always leave a paper trail.

14 posted on 02/06/2011 12:24:48 PM PST by Liz
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To: Liz
*** Beneath that smiling twinkle is a conniving criminal. "Hi, I'm Bernie. Trust me." ***

Initially I *was* going to say something like: I hope he gets gang raped by Bubba, Tyrone, Jose, Maurice and everyone in the Aryan Brotherhood. But THEN, I looked up where Inmate #61727-054 is at.

Butner Federal Correctional Complex is a fricken Country Club!

The biggest 'danger' Bernie will face is hurting his back in the Sand-Trap on the 14th Hole. Or tripping, and hurting his knee on the Tennis Court!

15 posted on 02/06/2011 12:25:21 PM PST by Condor51 (Suppose you were an idiot. And suppose you were a Congressman. But I repeat myself. [Mark Twain])
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To: Condor51
The biggest 'danger' Bernie will face is hurting his back in the Sand-Trap on the 14th Hole. Or tripping, and hurting his knee on the Tennis Court!

Yeah---but one consolation is he's there for a long, long time.

16 posted on 02/06/2011 12:32:12 PM PST by Liz
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To: Condor51; Liz

Liz, you’ve always had the straight dope on Madoff and his web of fellow unindicted felons.

As you’ve said, many of his cronies were also quite able in complex financial transactions. Harry Markopolous stated that South American and Russian mobs were feeding him money as well.

And that brings us to why Madoff turned himself in - he was looking for nominal protection against these mobsters.


17 posted on 02/06/2011 12:32:19 PM PST by NVDave
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To: NVDave; Condor51; AuntB; Tennessee Nana
Harry Markopolous stated that South American and Russian mobs were feeding Madoff money as well.

Yeah---thanks for posting that. I meant to bring it up.

That certainly was a compelling reason why Bernie turned himself into protective custody----so the savage Russian/latino drug lords could not get at him.

I think Bernie was stealing their money, too----but they were not about to wait for American jurisprudence to kick in.

Also makes you wonder if the Madoff son really committed suicide ...........or if mob justice muscled in.

18 posted on 02/06/2011 12:39:07 PM PST by Liz
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To: Liz

They were the same financial reports every else had, and as you say, many others had the same suspicions. Those who reported their thoughts to the government were ignored. Chase can say if the SEC gave him a clean bill of health, so who were we to question it?

I predict this case will be dismissed.


19 posted on 02/06/2011 12:43:05 PM PST by proxy_user
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To: proxy_user
Mmmmm…..dismissal is a possibility.

Picard better reconnoiter---maybe have the IRS step in.

The IRS is relentless if it thinks someone cheated. BTW, stolen money is taxable.

20 posted on 02/06/2011 1:06:19 PM PST by Liz
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To: Liz; proxy_user
Most people / fund managers who have invested with Madoff didn't think he ran a Ponzi scheme (or they would withdraw money much earlier), they thought he was using front-running to get his "stable results" and his unspectacular (relative to hot-shot hedge funds who boasted 20% or more) annual returns of about 8%-12% allowed him to fly under the radar of SEC and FInRA.

He had a trading floor (practically a mini-exchange) which made front-running a distinct probability, and should have exposed him to more regulatory scrutiny, not less, as was the case (him being a good liberal Democrat, and all). That was "the well-known cloud over the head of Madoff" but he was audited by SEC only a few times, on outside tips, with only a slap on the wrist for "regulatory compliance" misdemeanors.

Dropping or reporting a client because someone heard something from someone at lunch? Investment banking (or many other industries) would not exist if that were the case, but that kind of hearsay "warnings" always make great headlines in lawsuit news.

There is no substance here, the better case can actually be made against SEC and FInRA. But Picard can't lose by filing these kinds of lawsuits against "deep pockets" that are not currently favored by public at large - he might get a settlement (ridiculous $5B in "damages" to his clients should be thrown out out immediately) because it keeps him "in business" and collecting legal fees for several years while it would cost JPMorgan (and other "deep pockets") millions in legal fees, time, reputation and potential business. That's not very different from modus operandi that cons Larry Milberg and Melvyn Weiss (of former Milberg Weiss Bershad & Schulman) used in their sleazy class action lawsuits, only here it's actually authorized by the SPIC:

From - NY, 2011 February 04

That comment actually proves that they didn't know about Bernie's Ponzi scheme - only that it "looked too good to be true" for them to invest with him. They didn't have the responsibility to do the same kind of due diligence for anyone else, or even disclose it (may even have been prevented from external disclosure by lack of evidence and potential "defamation" or "loss of business" lawsuits).

Quick dismissal of this kind of lawsuit would be a positive step against legal abuse; "clawback" process shouldn't be used for "fishing expeditions" and "lawsuits with intent to settle" based on nothing more than some "degree of separation" with the schemer.

21 posted on 02/06/2011 4:27:36 PM PST by CutePuppy (If you don't ask the right questions you may not get the right answers)
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To: CutePuppy
From Lawsuit charges JPMorgan suspected, but ignored, Madoff fraud - NYP, By Chuck Bennett, Kaja Whitehouse and Bruce Golding, 2011 February 04
22 posted on 02/06/2011 5:01:50 PM PST by CutePuppy (If you don't ask the right questions you may not get the right answers)
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To: CutePuppy; Wiggins; NVDave; Diana in Wisconsin; Just mythoughts; Frantzie; ken5050; Condor51; ...
EXCERPT.......a JPM employee received a terrifying message from Aurelia Finance, a Swiss-based wealth-management firm that invested with Madoff feeder funds. "The rep made threats referring to 'Colombian friends' who could 'cause havoc,' telling [the JPM employee], 'we know where to find you,'" court papers say. BIG CLUE A JPMorgan banker handled a Madoff account for a decade...... money supposed to buy securities, just kept moving in and out of Madoff's bank account.......

LINK http://m.nypost.com/f/mobile/news/local/trustee_execs_fraud_shocker_chase_qHit6NpVPyZAZ0nZCgNNcL

POSTER'S ANALYSIS Feeder funds were placing enormous amounts with Bernie-----most never told investors where their money was going. The array of foundations and non-profits giving large sums to Bernie means he helped shady people commit tax evasion, by setting up offshore accounts.

Here's another rich and successful Madoff investor (/snix).

Hamptons Mega Mansion of Ira Rennert, Founder of Renco Group. Hamptonites complain the mansion is actually a yeshiva.

This Sagaponack, NY, obscenely gargantuan mansion, dubbed Fairfield, is reportedly the largest occupied residential compound in America Square Feet: 66,000 / 110,000 (including outbuildings). It is situated on 63 prime acres and houses 29 bedrooms and 39 bathrooms. It also has a dining room that stretches 90 feet long, a bowling alley, two tennis courts, a squash court, a 164 seat movie theater, and a 200 car garage. This home also contains a rather rare item; its own power plant. Fairfield is currently valued at more than $185 million.

SOURCE hubpages.com/hub/Top-Ten-Mega-Mansions

Or is this the rebuilt Temple of Solomon?


23 posted on 02/07/2011 3:17:30 AM PST by Liz
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To: Liz

Thank you for the post. The depth of this crime is amazing. Here’s another link to a recent N.Y. Post article about the Wilpon’s and Saul Katz.

http://www.nypost.com/p/news/local/amazin_kin_all_had_to_bern_dwIueqtoYrU2uhjaoXEUaL


24 posted on 02/07/2011 7:16:56 AM PST by Wiggins
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To: Wiggins; CutePuppy; NVDave; Diana in Wisconsin; Just mythoughts; Frantzie; ken5050; Condor51; ...

Thanx for the link. Man oh man-—the Wilpon family cleaned up. The trustee id’ed some 483 Wilpon accounts with Madoff. Wonder what their IRS returns look like (/snix).

All the parties pinged need to read this.

http://www.nypost.com/p/news/local/amazin_kin_all_had_to_bern_dwIueqtoYrU2uhjaoXEUaL


25 posted on 02/07/2011 11:01:38 AM PST by Liz
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To: CutePuppy; Condor51; ken5050

NYP EXCERPT Wilpon’s BIL Saul Katz told his country club friends that “nobody knows how Madoff does it.”

Madoff complained about Katz in a 2004 phone call to Katz’s business associates, Arthur Friedman, VP of Sterling Equities (the Wilpon’s investing entity).

Katz’s blathering irritated Madoff because his epic Ponzi scheme depended on an air of mystery and intrigue to ward off regulators and lure customers.

http://www.nypost.com/p/news/local/amazin_kin_all_had_to_bern_dwIueqtoYrU2uhjaoXEUaL


26 posted on 02/07/2011 11:37:36 AM PST by Liz
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To: Liz; CutePuppy; Condor51

Question: Sandy Koufax, one of the game’s greatest pitchers, is boyhood friends with Wilpon..they went to HS together. Koufax still makes an appearance at Mets spring trainig each year. Koufax had some financial difficulties a while back. I wonder if/why Wilpon ever had him invested with Bernie. Koufax is like a Jewish GOD to these guys..and admittedly, to me also, so I can’t believe they wouldn’t try to help him out...and Bernie would love to be able to say that Koufax was a client of his..heck..he’d probably have him atend his grandkids’ bar mitzvahs...it would be a coup..anyone see Sandy’s name on the list?


27 posted on 02/07/2011 2:07:56 PM PST by ken5050 (Palin/Bachman 2012 - FOUR boobs are better than the two we have now!)
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To: ken5050
HUFFINGTON POST Sandy Koufax Invested With Madoff
AP   |  RONALD BLUM   |   February 5, 2009
LINK AT WEB SITE-----Madoff's Client List

EXCERPT — Hall of Famer Sandy Koufax, a high school baseball teammate and friend of Mets owner Fred Wilpon, was among the clients who invested with Madoff, according to a court filing. Accounts involving the Mets, their owners and Wilpon-affiliated companies were listed, many with Shea Stadium addresses. NOTE: Latest is Wilpons had 483 accounts with Madoff.

SOURCE http://www.huffingtonpost.com/2009/02/05/sandy-koufax-invested-wit_n_164283.html


28 posted on 02/07/2011 2:34:45 PM PST by Liz
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To: CutePuppy
SOURCE http://www.huffingtonpost.com/2009/02/05/sandy-koufax-invested-wit_n_164283.html
AP | RONALD BLUM | February 5, 2009

EXCERPT (As of 2009) Among the Wilpon-connected entities that had accounts with Madoff:

Sterling Mets, the Mets Limited Partnership;

the New York Mets Foundation;

Sterling Doubleday _ the entity that owned the team when Wilpon and Nelson Doubleday were partners;

Fred Wilpon and his wife, Judy, had individual accounts;

Fred's brother Richard;

Saul Katz, Wilpon's brother-in-law; Katz is the Mets' team president;

Jeff Wilpon, Fred Wilpon's son and the team's chief operating officer;

Valerie Wilpon, Jeff's wife;

Robin Wilpon Wachtler, Jeff's sister;

Charitable foundations of Fred and Judy Wilpon, and of Jeff and Valerie Wilpon;

several Wilpon family trusts;

Brooklyn Baseball Company, the Mets-controlled company that owns the minor league Brooklyn Cyclones,

Coney Island Baseball.

(As of 2009) Prosecutors claim Madoff admitted he lost more than $50 billion belonging to investors. Defense lawyers say he has cooperated with authorities to help identify assets.

(As of 2009) The Mets have not said how much the entities and individuals have lost. Jeff Wilpon said in December 2008 the money can be replenished over time as the operating businesses generate profits. "The individual partners lost some money at Madoff. It doesn't affect the Mets. It doesn't affect the Citi Field project. It doesn't affect SNY or any of our other operating businesses," Jeff Wilpon said.

29 posted on 02/07/2011 2:46:04 PM PST by Liz
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To: Liz

I bet the IRS is still trying to calculate what the Wilpon’s owe and hid from them. The IRS is probably licking their chops on this one. The tax case will be coming next.


30 posted on 02/07/2011 4:15:19 PM PST by Wiggins
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To: Liz

Ah, thanks....I figured as much..


31 posted on 02/07/2011 6:32:50 PM PST by ken5050 (Palin/Bachman 2012 - FOUR boobs are better than the two we have now!)
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To: proxy_user

Whatever my thoughts of Chase and other big banks God Forbid they should be policemen as well.


32 posted on 02/07/2011 6:46:47 PM PST by nomorelurker
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To: Liz; Wiggins; ken5050
Sandy Koufax was one of the "celebrity investors" with Madoff, along with several high profile celebrities including Kevin Bacon and his wife Kyra Sedgwick (from a wealthy New England/NY family) that gave investments with Madoff an aura of exclusivity.

Re multiple accounts, keep in mind that many of these accounts go back some 20-25 years, so it may depend what purpose and how they were created, in parallel or serially? For instance, if accounts were set up like non-liquid CDs or time deposits, it would mean that any additional funds deposited with Madoff would go into separate [CD-like] accounts. This sometimes could be helpful for tax accounting, determination of ST/LT profit tax rates, separation of accounts for loans against them and so on...

From your link Mets' owners' kin made millions from Madoff: suit - NYP, by Kathianne Boniello and Cathy Burke, 2011 February 06

This confirms what I have suspected - while withdrawing some $48M in net profit from account(s) at Madoff, they used the account(s) and Madoff phony statements as a "soft collateral" for the loans to run Mets operations and execute contracts,
a) to avoid tax hit on profit and let it compound, and
b) use cheaper source of capital.

Now these loans are biting back, so they need to raise money (by selling part of ownership in the Mets) and gives some "legitimacy" to their claim of net loss with Madoff.

Interesting that Madoff had "liquidity problems" at the end of 2005; it suggests that he might have had unusually high rate of redemptions / withdrawal from his fund and had to to cover it by getting fresh capital, promising a higher rate of return in a "special investment opportunity".

From Wilpon labor pain - NYP, by Josh Kosman, 2011 February 08

The MLB may have to get involved with deferred comp contracts, change the rules, maybe mandate insurance or liens on accounts.

33 posted on 02/08/2011 2:43:43 AM PST by CutePuppy (If you don't ask the right questions you may not get the right answers)
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To: CutePuppy; Wiggins; ken5050
........while withdrawing some $48M in net profit from Madoff, the Wilpons used his phony statements as a "soft collateral" for loans a) to avoid tax hit on profit and let it compound, and, b) use cheaper source of capital. Now they need to raise money (by selling part ownership) and give some "legitimacy" to their claim of net loss with Madoff..........

Mmmmmmmm.......not to worry, The IRS will figure that all out. They're r-e-a-l-l-y good at math (/snix).

Interesting that Madoff had "liquidity problems" at the end of 2005; it suggests that he might have had unusually high rate of redemptions / withdrawals and had to cover it by getting fresh capital, promising a higher rate of return in a "special investment opportunity"....... ……

"Hi, I'm Bernie. Trust me."

34 posted on 02/08/2011 3:04:31 AM PST by Liz
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To: Liz; CutePuppy; ken5050

No doubt MLB Players Association will be looking for some kind of regulation on how deferred money is invested by owners with the next CBA. I believe MLB will force the Wilpon’s to sell out completely to pay off this debt fast with the hopes that this thing goes away from at least a baseball perspective. Aside from all the victims that lost everything, this is giving MLB a black eye. Maybe two. Thank you for the post.


35 posted on 02/08/2011 8:34:22 AM PST by Wiggins
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To: Wiggins

Gotta disagree. ASs I said in my earlier post, deferred comp is a NON-QUALIFIED plan..the owners are not even required to set aside money in advance..they may choose to do so. Some teams do, some don’t, but even if they do so now, there’s nothing to prevent them from using that $$$ for something else later on. A-Rod wasn’t worried about losing his $250 mill, MLBB would have stepped up and made him whole...they have to. This is one issue the players aren’t worried about


36 posted on 02/08/2011 9:41:35 AM PST by ken5050 (Palin/Bachman 2012 - FOUR boobs are better than the two we have now!)
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To: Wiggins

Gotta disagree. ASs I said in my earlier post, deferred comp is a NON-QUALIFIED plan..the owners are not even required to set aside money in advance..they may choose to do so. Some teams do, some don’t, but even if they do so now, there’s nothing to prevent them from using that $$$ for something else later on. A-Rod wasn’t worried about losing his $250 mill, MLBB would have stepped up and made him whole...they have to. This is one issue the players aren’t worried about


37 posted on 02/08/2011 9:41:43 AM PST by ken5050 (Palin/Bachman 2012 - FOUR boobs are better than the two we have now!)
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To: Liz; Wiggins; ken5050; proxy_user
Looks like JPMorgan's lawyers figured this out:

From JPMorgan claims no wrongdoing in Madoff mess - NYP, 2011 February 09

Sounds familiar - this is effectively a "deep pockets" class action extortion suit à la Milberg Weiss; it's not within the letter, the spirit or the purview of the "clawback" law. A quick dismissal should put Picard in his place and back on track looking for the money and the real culprits / co-conspirators, not the scapegoats.

38 posted on 02/09/2011 11:23:32 PM PST by CutePuppy (If you don't ask the right questions you may not get the right answers)
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To: CutePuppy; Wiggins; ken5050; proxy_user
JP Morgan is using a "deep pockets" class action extortion suit à la Milberg Weiss; it's not within the letter, the spirit or the purview of the "clawback" law. A quick dismissal should put Picard in his place and back on track looking for the money and the real culprits / co-conspirators, not the scapegoats.

Lest we forget---Milberg and Lerach are enjoying the facilities at the Graybar Hotel (.snix).

=====================================

The "class action" scam.

EXCERPT---NYP---June 3, 2008 -- Mel Weiss, co-founder and chief trial counsel for the securities law firm Milberg LLP, was sentenced to 2 1/2 years for illegally paying clients to file shareholder suits that earned $251M in fees. Weiss pleaded guilty, admitting he helped secretly pay a stable of plaintiffs to file 150 suits, 1979-2005. They and their counterparts engineered cases and paid litigants to sue, that forced companies to payout $45B.........and damaged millions of stockholders. Indictments included racketeering conspiracy, mail fraud, money laundering. Lerach also made shady donations to John Edwards’ campaign.

39 posted on 02/10/2011 3:50:33 AM PST by Liz
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