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LET US COUNT THE WAYS LEFTIES CHEAT THE IRS keep in mind, these are practiced connivers playing all the angles.

<><> Buying huge amounts of casino chips--they are untraceable--can be easily cashed in--or used to gamble.

<><> Proceeds from gambling are deposited in a super-secret LLC account linked to a film company credit card. The tax cheaters could then direct the bank to transfer the money to the film company credit card. That way the gambler could keep his winnings secret and still have his personal expenses, ATM withdrawals and other expenditures covered…..and nobody would have to know gambling was involved.

<><> Money Laundering Techniques: (1) Underground, unregulated banking services (common in ethnic communities), (2) offshore "investments," (3) offshore banking, (4) monies wire-transferred to friends and/or family members living in offshore banking havens.

<><> There was a huge scandal in Hollywood years ago----the FBI was investigating these “friendly” poker games that the organizers "fixed."

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WERE THEY USING THE MADOFF MO? : 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 groups 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 IRS fraud.

The court-appointed trustee tracing Madoff's assets found 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.

The perp ran a hedge fund but was convicted of criminal fraud for running a ponzi scheme and sent to prison. The bankruptcy trustee is trying to get the money back that the perp lost on the theory that it was investor money improperly transferred.

The suit is based on the fraudulent conveyance provisions of the Bankruptcy Code and California statutes, which can be pretty technical.

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Yes, this is purely a civil "clawback" recovery claim, without any IRS tax claims or allegations of illegal means involved on the part of the eventual / final recipients of ill-gotten gains by Ruderman. If IRS and/or FBI are interested in the case they will have to have separate investigations and/or cases - the "clawback" doesn't rely or concern itself with the legality or illegality of the chain or final acquisition of the original "fruit of illegal gain".

In the past, several highly public cases of expensive artworks acquired by well-known people (reportedly, Bill Gates, Tom Hanks, etc. Art, Restored - Forbes, by David Armstrong, 2007 December 27) turned out to have been stolen and sold, so they were returned to their legitimate owners without recompense to end-buyers, but without any allegation of fraud, conspiracy or intent to defraud by the end-buyers of stolen art.

That's the biggest problem with Madoff's case trustee Irving Picard trying to "prove" and extract money from the banks and some other defendants (like the Mets owners) by suing them on the basis that they "had to know that Madoff was running illegal scheme" - that basis maybe the case for FBI (if he wants to share his "proof" of that) but it's irrelevant for the "clawback" statute so he still would not get any money for his "clawback" class on this basis and the [potential] lawsuit of wrongdoing would not belong in the bankruptcy court.

Picard at this point is really a glorified accountant, being handsomely paid (at a rate of $697.50 per hour, or at a "discounted" rate of $510 per hour when "outsourced" to Alan Nisslson of Windels Marx Lane & Mittendorf) for playing a Perry Mason and is just trying to make himself look good in the eyes of the class while padding his billable hours with these irrelevant lawsuits and ridiculous public relations media campaign. Trying to "scare" opposing lawyers into settlements by accusing their clients of "knowledge of wrongdoing" and by "flashing" large "punitive" numbers in a lawsuit is not going to fly at that level, it only makes him a self-serving laughingstock who is profiting at the expense of his class.

From Tobey Maguire, Billionaire Alec Gores Being Sued For Poker Winnings From Jailed Ponzi Schemer - Forbes blog, by Chris Barth, 2011 June 22

A number of celebrity card sharks are in hot water after winning big bucks from jailed hedge fund manager Brad Ruderman in a series of underground Beverly Hills poker games in 2007 and 2008, Star magazine and RadarOnline are reporting. Actor Tobey Maguire and billionaire Alec Gores (#782 on the Forbes list of the World's Billionaires) are among those being sued. The pair allegedly won $311,000 and $445,000 respectively from convict Ruderman, who defrauded investors in a Ponzi scheme to the tune of more than $25 million. Ruderman is currently serving a ten year sentence in federal prison.

According to documents... published by Star and Radaronline, the duo allegedly won portions of the money Ruderman embezzled as part of a weekly poker game, including $110,000 of investor cash that Maguire won in a single hand. The weekly games often included movie stars Ben Affleck, Leonardo DiCaprio and Matt Damon, as well as other celebrities who are facing lawsuits. Affleck, DiCaprio and Damon have not been sued.

The documents posted by RadarOnline are clear in the assertion that the stars are not linked to Ruderman's scheme, however. ..... < snip >

..... The suits cite figures in Ruderman's personal bank account to demonstrate that he would not have been able to pay off his debts without dipping into money illicitly obtained from his investors. "Based on the lack of sufficient funds in Ruderman's personal account at City National Bank to pay the losses from the Poker Games, Ruderman transferred funds from the Debtor to Ruderman's personal account at or about the time when the poker losses occurred and at or about the time when funds were transferred from Ruderman to Defendant," read the documents. ..... < snip>

..... Trustees of the suit seek to recoup the money in those transfers, which were allegedly "compromised of improperly-diverted investor funds." ..... < snip >

..... Ruderman ran his Ponzi scheme from 2003 through 2009, targeting family members and close friends. The scheme raised upwards of $44 million dollars in two hedge funds -- Ruderman Capital Partners and Ruderman Capital Partners A - and promised lofty returns of 60% per year. ..... < snip >