World Business

Malkovich seeks more from Madoff

By Jonathan Stempel (China Daily)
Updated: 2010-04-03 10:33

NEW YORK - Actor John Malkovich, a former client of Bernard Madoff, is seeking to recover $2.23 million from the liquidation of the securities firm once run by the imprisoned Ponzi schemer.

In a Thursday filing in Manhattan bankruptcy court, the John Malkovich Pension Plan and Trust objected to a decision by Irving Picard, the trustee liquidating Madoff's firm, to award it $670,000.

Like many other Madoff investors, the Malkovich trust argued that it deserved the balance reflected on its November 30, 2008, account statement from Bernard L. Madoff Investment Securities LLC, the final statement prior to Madoff's arrest 11 days later.

On March 1, US Bankruptcy Judge Burton Lifland, who is overseeing the Madoff firm's liquidation, endorsed Picard's "net equity" method to calculate losses, marking the differences between what investors put into and took out of the firm.

Victims who believe the final balances reflect what they should recover, even if the sums are fictitious, are appealing to a federal appeals court in New York. The Malkovich trust said it expected that court to overturn Lifland's ruling.

"A customer generally expects to receive what he believes is in his account at the time the stockbroker ceases business," the trust argued.

"While there may be a basis to disallow customer claims for wholly fictitious securities of nonexisting entities, here the securities set forth on (the) Malkovich Trust's final BMIS statement and prior statements were those of actual companies listed on the stock exchange," the trust argued.

Among other victims of Madoff's estimated $65 billion Ponzi scheme were actor Kevin Bacon, Hall of Fame baseball pitcher Sandy Koufax, World Trade Center site developer Larry Silverstein, Nobel Peace Prize winner Elie Wiesel and New York Mets owner Fred Wilpon.

Bernard Madoff is serving a 150-year prison sentence.

The case is Securities Investor Protection Corp v Bernard L. Madoff Investment Securities LLC, U.S. Bankruptcy Court, Southern District of New York, No. 08-1789.

Reuters