Madoff Trustee Gets $1B Settlement
The announcement said Picard reached a settlement with more than a dozen domestic and foreign investment funds, their affiliates and a former chief executive associated with Rye, New York-based Tremont Group Holdings, Inc., the multi-billion-dollar money management company and operator of the second-largest Madoff “feeder fund” group, the Rye Select and Tremont families of funds.
The settlement also includes three co-defendants named in the suit: Oppenheimer Acquisition Corp., an affiliate of the Oppenheimer family of mutual funds which acquired Tremont Group in 2001, and Oppenheimer’s parent corporations, MassMutual Holding LLC and the Massachusetts Mutual Life Insurance Company.
As part of the settlement agreement, the defendants will deliver cash payments into escrow totaling more than $1 billion, which will ultimately be placed into the Customer Fund and distributed, pro rata, to BLMIS customers with allowed claims. The payments, combined with the approximately $2.6 billion already in the Customer Fund and the $5 billion settlement with the Picower estate (currently under appeal) brings the Trustee’s recoveries to more than $8.6 billion, or nearly 50% of the approximately $17.3 billion in principal that was lost in the Ponzi scheme by customers who filed claims.
Picard accused Tremont of missing “red flags” and “blindly relying on Madoff to drive their funds’ returns” for nearly 15 years (see Madoff Trustee Goes After Tremont for $2.1B).In the settlement agreement, both sides state their desire to avoid the risk, expense and delay associated with litigation.
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