Prosecutors Want Madoff’s Stuff

MANHATTAN (CN) - Federal prosecutors on Wednesday joined the SEC in asking that the judge overseeing the SEC case against Bernard Madoff deny "certain third parties" relief from seizure and distribution of some of Madoff's assets to his victims. The U.S. Attorney's letter U.S. District Judge Louis Stanton refers to "47 specifically enumerated assets, including three motor vessels, four pieces of real property, approximately $17 million in a Wachovia bank account, and $45 million in an account at Cohmad Securities Corp."

The letter begins: "As we have previously stated, this Office intends to maximize recovery for victims of the Madoff fraud by distributing forfeited property to those victims. This Office therefore joins in the objection filed by the Securities and Exchange Commission ("SEC") to the motion filed on April 1, 2009 by certain third parties for partial relief from the permanent injunction ordered by the Court. We do so both for the reasons set forth by the SEC and because the motion is premised on a fundamental misunderstanding of forfeiture and bankruptcy law. Moreover, the motion, if granted, would risk detracting from the recovery to victims because funds otherwise available for return to victims by way of forfeiture would unnecessarily be used to pay the fees of a bankruptcy trustee. To correct the erroneous premise of the movants' application, we describe below the Government's forfeiture powers in this case and the rights of third parties to object or intervene in forfeiture proceedings."

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