by Brian Mahany
History buffs will remember President Roosevelt’s famous speech after the bombing of Pearl Harbor. He started that speech by saying, “Yesterday, December 7th, 1941, a date that will in infamy…” He went on to inform a shocked nation about the surprise attack on Pearl Harbor. A little more recently, December 11th has also become a date which will live in infamy. It is the date in 2008 when Bernie Madoff was arrested for the largest Ponzi scheme in history.
Four years later, many of Madoff’s victims are still struggling. Many may never collect a penny even though they have lost their life savings. This is a story that needs to be told.
Within the financial world, Irving Picard, has become a household word. He is the court appointed trustee charged with gathering Madoff’s assets and in some cases, getting money from earlier investors who were fortunate to get paid back and redistributing it to those who received nothing. Unfortunately, many will never see anything.
Picard has taken the position that only those who invested directly into Madoff’s company are eligible to share in the recoveries. Many investors, however, invested through feeder funds. Some victims didn’t even know their money was invested with Madoff.
We are familiar with one investment fund that told people it was investing in a widely diversified basket of funds. The theory was that by spreading the risk over many funds, poor performance by part of the portfolio wouldn’t wipe out anyone’s life savings. Unfortunately, the fund’s promoter needed solid returns to keep investors happy and soon invested 100% of the funds into (you guessed it) Bernie Madoff.
Ordinarily, the fund’s investors would be able to receive some of the money collected by Picard. Those that invested in feeder funds get nothing, however. Some of the so-called indirect investors have filed legal challenges against the trustee.
Private attorneys have stepped in to fill that gap. In some cases, for example, there might be claims against the fund promoter for not doing proper due diligence or for not following the funds stated investment strategies. There may also be good claims if the feeder fund was purchased through an investment adviser or stockbroker.
If you have lost money to an investment scheme or fraud or a Ponzi scheme, give us a call. The investment fraud lawyers at Mahany & Ertl have helped many investors get back their hard earned money from around the nation and even beyond our borders. For more information, contact attorney Brian Mahany at or by telephone at (direct).
Mahany & Ertl – America’s Fraud Lawyers. Offices in Milwaukee, Wisconsin; Detroit, Michigan; Portland, Maine; Minneapolis, Minnesota and coming soon, San Francisco, California. Services available in many jurisdictions.