Federal judge moves to protect Madoff assets from bankruptcy creditors Andrew Gilmore at 6:42 AM ET
[JURIST] Judge Denny Chin of the US District Court for the Southern District of New York [official website] issued a restraining order Monday that protects from bankruptcy more than $100 million in assets of financier Bernard Madoff [JURIST news archive]. Chin signed the order to protect assets that will likely be forfeited [AP report] by Madoff to the US government as a result of his guilty plea to securities fraud charges [complaint, PDF; JURIST report] stemming from his alleged multi-billion dollar Ponzi scheme. The order comes on the same day that a federal bankruptcy judge appointed an interim trustee [Bloomberg report] to oversee Madoff's assets ahead of attempts by injured investors to recoup losses suffered in the scheme. Madoff remains in custody following his plea.
Last month, Madoff pleaded guilty [JURIST report] to security fraud charges for his alleged involvement in a multi-billion dollar Ponzi scheme. In February, Madoff consented [JURIST report] to a partial judgment [SEC press release] with the SEC over civil charges brought by the SEC to obtain a preliminary injunction and asset freeze against him. The same day, then-SEC Division of Enforcement Director Linda Thomsen announced she was stepping down from her post [SEC press release]. In the week following Madoff's charges, then-SEC Chairman Christopher Cox [official profile] said that he would launch an immediate investigation [press release; JURIST report] into how the fraud allegedly perpetrated by Madoff went undetected for so long.
Paper Chase is JURIST's real-time legal news service, powered by a team of 30 law student reporters and editors led by law professor Bernard Hibbitts at the University of Pittsburgh School of Law. As an educational service, Paper Chase is dedicated to presenting important legal news and materials rapidly, objectively and intelligibly in an accessible, ad-free format.