JPMorgan, HSBC, UBS Win Big On Madoff

Madoff Mini-Me

The trustee seeking money for Bernard Madoff's victims suffered a big defeat as a federal appeals court rejected his bid to recover nearly $30bn from JPMorgan Chase and other banks he accused of aiding in the swindler's fraud.

Reuters reports that the 2nd U.S. Circuit Court of Appeals in New York said on Thursday trustee Irving Picard lacked standing to pursue a variety of claims on behalf of former Madoff customers.

It also said that because Picard 'stands in the shoes' of the former Bernard L. Madoff Investment Securities LLC, he could not pursue other claims on behalf of the firm's bankruptcy estate over a fraud that the firm itself orchestrated.

Thursday's decision upheld rulings by U.S. District Judges Colleen McMahon and Jed Rakoff in Manhattan, which the 2nd Circuit called 'well-reasoned'.

Those rulings dismissed roughly $19bn of claims against JPMorgan, $8.6bn of claims against defendants including HSBC and UniCredit, and $2bn of claims against UBS and many other defendants.

Unless Picard successfully appeals, it also limits how much he will have to distribute to victims of Madoff's Ponzi scheme once the recovery process is complete. That process began soon after Madoff's December 11, 2008 arrest, and may last years more.

Hit the link below to access the complete Reuters article:

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