A judge ruled that the Koch Brothers can keep their profit from Bernie Madoff's Ponzi scheme
Bloomberg's Erik Larson reported that a US Bankruptcy court in New York ruled against a trustee working to retrieve money for victims of Bernie Madoff's fraudulent activities. The conglomerate owned by Charles and David Koch was an early investor with Madoff, according to court records reviewed by Bloomberg.
In 2009, Madoff was sentenced to 150 years in prison after running the biggest Ponzi scheme in US history. The scheme typically uses money from new investors to pay off the promised returns to old ones.
Many of Madoff's victims have still not regained their losses.
The Koch Brothers had argued that the money was out of US legal reach because it had been transferred outside the US before Madoff's arrest in 2008. The trustee's attorney argued that the Koch Brothers must have known they were subject to US law at the time.
According to Bloomberg, Koch Industries was just one of dozens of Madoff's former customers in litigation, and together they are poised to keep up to $2 billion. The lawyer who is liquidating Bernard L. Madoff Investment Securities sued Koch to retrieve $21.5 million that the firm sent to a Koch unit in the UK.
Head over to Bloomberg for the full story »