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 For months lawyers and investors have been asking convicted conman Bernie Madoff, "Where's the money?"
We got a partial answer to that question Wednesday from Irving Picard, the trustee liquidating Madoff Investment Securities LLC: Madoff turned his investment firm into his "personal piggy bank," using tens of millions of dollars in client funds to cover costs for employees and family members, court papers say. Madoff used money from his firm to pay loans, satisfy capital calls, fund real estate purchases and hire employees for his children, wife, brother and workers, according to a filing by Picard (see below). "He essentially used BLMIS as his 'personal piggy bank,' having BLMIS pay for his lavish lifestyle and that of his family," David Sheehan, a lawyer for Picard, wrote in a legal brief filed in U.S. Bankruptcy Court in New York. "Madoff used BLMIS to siphon funds which were, in reality, other people's money, for his personal use and the benefit of his inner circle. Plain and simple, he stole it." The filing is part of a request by Picard to consolidate the bankruptcy proceedings of the business with the bankruptcy of Madoff's estate. Picard cited Madoff's expenses as a basis to join the cases, saying spending by Madoff and his business were so entangled that they can't be unraveled. The newly released documents, which include credit card statements, tax returns and other expenditures, provide a glimpse into Madoff's lavish lifestyle and give details about how family members and others benefited from his extraordinary wealth. According to the filing, Madoff Securities loaned $9 million to Madoff's brother Peter, which was never repaid; gave $5.5 million to Madoff Technologies LLC, a firm which family members owned a majority stake; and provided a $1.7 million capital contribution to Madoff Energy Holdings, which was owned by his sons Mark and Andrew and niece Shana. Madoff Securities used $4.5 million in client money to satisfy capital calls on behalf of wife Ruth to funds in which she invested; paid $11.5 million for two yachts his family used; and sent $4.4 million to law firms on behalf of Andrew Madoff and another $6.4 million to law firms on behalf of Mark Madoff, the filing says. Money for his children was used for real estate purchases, the filing says. Madoff appears to have used $2.7 million of his firm's cash to pay for a home in New Jersey for a longtime employee, JoAnn Crupi. He also placed on the payroll of Madoff Securities the captain of a boat owned by Frank DiPascali, his chief aide in his advisory business, the documents say. Meanwhile, Madoff's longtime secretary, Eleanor Squillari, penned a tell-all on her boss for the June edition of Vanity Fair. A video interview on the site with co-author Mark Seal Squillari says Madoff was preoccupied before his arrest, and his health deteriorated. "He was taking medication. He was having a lot of back pain. ... He would have to lie on the floor to give himself relief." She also said in an interview that she thinks he's not cooperating with authorities in order to protect others. She declined to speculate as to whom. Additionally Picard is also seeking the return of "billions of dollars" from so-called feeder funds that funneled money to Madoff. Last month, he told 223 other investors to return as much as $735 million or face legal action. He's already launched three cases seeking to reverse transfer of funds out of Madoff firm accounts, he said. - Donna Block Filing By Irving H. Picard Madoff's Country Club Expenses Bernie's Credit Card Statements
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Madoff should be skinned alive then hung by the balls till death.