6/29/09

Times: Madoff Investors Through Merkin Feeder Funds are Out of Luck

Later today Ponzi schemer Bernard L. Madoff will be sentenced by the court.

Meanwhile, the Times' Eric Konigsberg reports that things don't look good for losers in the Madoff-Merkin Ponzi scheme as all the, "Investors Compete for a Piece of the Madoff Pie."
...Initially, those who were invested in the largest feeder funds, like J. Ezra Merkin’s Gabriel Capital and the Fairfield Sentry fund, were thought to be better positioned to recover their losses, in that those firms, unlike Mr. Madoff, would at least have assets to sue for. But several of the feeder funds are themselves being sued by Mr. Picard and are not likely to emerge with their money intact.

What is more, those who invested their individual retirement accounts in Mr. Madoff’s fund through feeder funds have been unable to obtain a theft-loss deduction on their federal taxes. They have had similar difficulties qualifying for an adjustment in their Medicare premium, which is based on income figures they now know to have been falsely inflated...more...

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