Scarinci Hollenbeck, LLC
The Firm
201-896-4100 info@sh-law.comFirm Insights
Madoff Redux: Trial of Madoff Employees to Commence
Author: Scarinci Hollenbeck, LLC
Date: October 18, 2013
Key Contacts
Back
The public is set to get its first in-depth look at one of the biggest frauds in U.S. history. The criminal trial of five former employees of Bernard Madoff begins in New York this month.
While Madoff claims to have acted alone, the federal government’s investigation suggests otherwise. Key staff members, ranging from Madoff’s former secretary to computer programmers, face criminal charges of fraud and conspiracy in connection with the $17 billion Ponzi scheme.
The defendants are the only former employees not to accept plea deals and have instead chosen to challenge the government’s evidence against them. Bernie Madoff pleaded guilty to 11 criminal counts and is currently serving a 150-year prison term. While he is not expected to testify, Frank DiPascali, Madoff’s former chief financial officer, has agreed to take the stand for the prosecution in exchange for leniency. His testimony will play a crucial role in explaining how the massive role operated and detailing the specific role each defendant played.
In a separate legal action, Irving H. Picard, the trustee seeking reimbursement on behalf of scorned investors, recently asked the U.S. Supreme Court to decide whether he has standing to sue financial institutions like JPMorgan Chase and HSBC Holdings PLC for the role they may have played in aiding the Ponzi scheme. Picard contends that the banks ignored red flags that strongly suggested Madoff was operating a Ponzi scheme.
“Bernard L. Madoff did not act alone,” the brief argues. The scheme “could not have persisted for so long, or defrauded so many of so much, without a network of financial institutions, feeder funds and individuals who participated in his fraud or acquiesced in it — just like any large-scale financial fraud.”
The United States Court of Appeals for the Second Circuit sided with the bank, holding that because the trustee “stands in the shoes” of Madoff, he could not sue third parties alleged to have aided and abetted the fraud. Other federal courts have ruled differently, increasing the chances for Supreme Court review.
If you have any questions about these cases or would like to discuss the legal issues involved, please contact me, Jay Surgent, or the Scarinci Hollenbeck attorney with whom you work.
- Practices: Corporate Transactions & Business, Financial Services & Regulatory Practice
- Locations: New York City, Red Bank, NJ, Little Falls, NJ
No Aspect of the advertisement has been approved by the Supreme Court. Results may vary depending on your particular facts and legal circumstances.
Related Posts
See all
Why Every Business Should Conduct an Annual Insurance Coverage Review
Most New Jersey business owners purchase insurance policies, file them away, and assume they are protected if a claim arises. Without a regular insurance coverage review, many companies discover gaps only after a lawsuit, cyberattack, property loss, or other significant event occurs. An annual insurance coverage review can help businesses identify potential risks, ensure their […]
Author: George McGowan
Demand Letters & Cease and Desist Letters: When to Send One (and When Not To)
Businesses and individuals often encounter situations where another party breaches a contract, fails to pay a debt, or continues harmful conduct. In many such disputes, a precisely drafted demand letter or cease-and-desist letter serves as a powerful legal tool. It can frequently resolve the dispute and avoid litigation. While demand or cease-and-desist letters can resolve […]
Author: George McGowan
How to Effectively Use Contracts to Manage Risk
Key provisions in your contracts, including those relating to indemnification, insurance, and defense, are essential to contract risk management. While sometimes considered “boilerplate,” these provisions play a pivotal role when determining which party is responsible for certain costs and liabilities. They must always be negotiated and drafted carefully. Indemnification Clauses Businesses should never overlook the […]
Author: George McGowan
Understanding Portability for Estate and Gift Tax
Portability of estate and gift tax enables a surviving spouse to inherit any unused portion of their deceased spouse’s federal estate and gift tax exemption. So, if one spouse doesn’t utilize their full exemption, the surviving spouse can effectively double their exemption amount with regard to estate tax liability. For married couples, portability offers a […]
Author: Marc J. Comer
Pet Trusts in New Jersey and New York: A Practical Estate Planning Tool
For many of us, pets are more than companions—they are members of the family. Yet they are often overlooked or inadequately provided for when it comes to estate planning. A pet trust offers a legally enforceable way to ensure that your animal continues to receive proper care if you become incapacitated or pass away. As […]
Author: Marc J. Comer
How Can Trusts Be Used in Business Succession?
For many New Jersey business owners, a closely held company represents decades of work, financial investment, and personal sacrifice. Trusts in business succession planning are one of the most effective tools for protecting that value, allowing founders to control how and when the business passes to the next generation while reducing the risk of disputes, […]
Author: George McGowan
No Aspect of the advertisement has been approved by the Supreme Court. Results may vary depending on your particular facts and legal circumstances.
Sign up to get the latest from our attorneys!
Explore What Matters Most to You.
Consider subscribing to our Firm Insights mailing list by clicking the button below so you can keep up to date with the firm`s latest articles covering various legal topics.
Stay informed and inspired with the latest updates, insights, and events from Scarinci Hollenbeck. Our resource library provides valuable content across a range of categories to keep you connected and ahead of the curve.