Madoff Trustee Sues, as Charities Spurn Madoff Money

Bloomberg reports that Schneiderman in June agreed to settle a state lawsuit against the investor, J. Ezra Merkin, for $410m. The agreement provides $405m to compensate investors and $5m for the state. In the suit, filed in 2009 by Schneiderman’s predecessor, Andrew Cuomo, the state claimed Merkin and his funds secretly steered assets to Madoff and concealed Madoff’s role, harming investors.

'Merkin’s money is not limitless, and with the prospect of over $400m depleted through the settlement, the trustee is concerned that little or nothing will be left for BLMIS customers,” Irving Picard, the trustee liquidating Madoff’s brokerage, said yesterday in a bankruptcy court filing in Manhattan.

Asking the federal judge in Manhattan to impose a preliminary injunction against Schneiderman, using bankruptcy law, he said, 'If other attorneys general around the country could simply walk into state courts and secure settlements as the NYAG did, the BLMIS estate would be decimated, with residents of various states favored'.

In the meantime, The New York Post reports that Bernie Madoff’s name is so radioactive that his kin can’t even give their money away.

Donations totaling more than $250,000 from charitable organizations founded by the Ponzi king’s two sons, Andrew and Mark, were rejected last year, according to tax records obtained through Guidestar, a nonprofit tracking service.