The hard-charging trustee of Bernie Madoff’s property is pushing a New York Metropolis energy couple to interrupt up their super-sized Manhattan house — and promote two-thirds of its sq. footage to compensate the late Ponzi schemer’s victims, The Put up has realized.
Irving Picard — the legal professional who has clawed again almost $15 billion for Madoff prospects burned within the fund’s 2008 collapse — goes to uncommon lengths to implement an April 2022 courtroom ruling that discovered New York lawyer Malcolm Sage was a uncommon “web winner” within the Madoff mess.
Sage and his spouse Lynne Florio — a cosmetics mogul who previously was a prime government at skincare model La Prairie — reaped $16.9 million in income from the ill-fated fund, in keeping with paperwork filed in New York state Supreme Court docket.
Picard, nonetheless, satisfied a federal decide that those that withdrew greater than they deposited with Madoff — who died in jail in 2021 whereas serving 150 years for securities fraud — should give again the distinction.
Now, Picard is now pushing for Sage to divvy up the couple’s swanky, 3,000-square-foot Greenwich Village condominium, which they created 30 years in the past by becoming a member of collectively three separate items.
Picard claims he can order the seizure of two of the residences — which measure 1,210 sq. toes and 902 sq. toes, respectively — as a result of they “stay legally distinct items and retain their authentic, distinguishable block and lot numbers.”
He estimates the 2 residences are value an estimated $4.6 million, in keeping with the petition.
“The trustee has by no means gone to those lengths” to recuperate belongings, mentioned a supply conversant in the case.
Walling off and promoting these two items would depart Sage and Florio with a 930-square-foot, one-bedroom house on the 14th flooring at 45 Christopher St. — an Artwork Deco fashion tower in-built 1931 that claims to be one of many metropolis’s “most-sought after” addresses.
“Malcolm Sage’s solely recognized invaluable asset that might be utilized in direction of partial satisfaction of the Judgment is his 50% curiosity in Residences 14B/C,” the grievance alleges.
“Promoting residences 14B/C is the one viable means by which (the) petitioner can implement the judgment,” it provides.
Sage and Florio, who used to run with New York’s glamorous set and have been photographed collectively on the American Ballet Theater gala in Might 2007 — a yr and a half earlier than the Madoff scandal hit — at the moment are representing themselves with out a lawyer, in keeping with courtroom papers.
There is no such thing as a suggestion that the couple was conscious of how Madoff ripped off his buyers or any allegations of prison wrongdoing towards them.
In a separate submitting on July 7, Sage and Florio claimed they can’t give up the 2 properties.
“The suggestion ‘to retreat’ to the confines of a one-bedroom house they bodily mixed with two different items within the Nineties made no sense as a result of the items aren’t bodily capable of be divided,” they wrote.
Ariel Berschadsky, an legal professional working for Picard, hit again that their story was “ludicrous.”
“Residence dwellings in New York Metropolis are recurrently conjoined and separated,” he wrote in a July 8 submitting. “In residences as invaluable as these of the Sages, these prices could be inconsequential.”
Sage and Florio insisted that Picard gained the judgment towards them by “deceptive” the decide, calling it “a fraud on the courtroom.”
They wrote to Picard’’s agency, Baker Hostetler, denying that they’d profited from Madoff’s dodgy scheme.
“To set the document straight, all Madoff victims have been web losers and will have been handled as such,” Sage wrote in his July 16 missive. “These victims mustn’t have to show over their belongings together with their houses, via the actions of attorneys capitalizing on the struggling of these already struggling.”
A spokeswoman for Picard’s agency, Baker Hostetler, declined to remark.
Neither Sage nor Florio responded to The Put up’s requests for remark.
Sage’s brother, Martin, and sister-in-law, Sybil, settled an identical clawback case on Sept. 5 by which Picard sought to retrieve $4.5 million. The main points of the settlement haven’t been disclosed.
His sister, Ann Passer, was accused by the trustee of raking in $4.7 million. She additionally agreed to an undisclosed settlement in June final yr.
Picard and his legislation agency have been tasked in 2008 with recovering any good points from Madoff’s Ponzi scheme, an funding rip-off that pays early buyers with cash from later buyers moderately than from any precise income.
He claims on his web site that he has raked in almost $15 billion as of final month from his estimated principal lack of $18 billion.
Arrange in 1960, Bernard L Madoff Funding Securities turned certainly one of Wall Avenue’s largest market-makers, an organization that matches patrons and sellers of shares.
Over time, the agency was investigated eight occasions by the SEC as a result of it made distinctive returns.
However the 2008 international monetary disaster prompted the agency’s demise as Madoff buyers, hit by the downturn, tried to withdraw some $7 billion, and he couldn’t discover the cash to cowl it.
The record of these scammed included actor Kevin Bacon, Corridor of Fame baseball participant Sandy Koufax, the Wilpon household that previously owned the New York Mets and movie director Steven Spielberg’s charitable basis, Wunderkinder.
A string of banks additionally misplaced cash, with HSBC Holdings saying it had round $1 billion in publicity and Japan’s Nomura reporting losses of $358 million.
