Trustee for Madoff firm in U.S. sues Kingate funds

NEW YORK (Reuters) - The trustee recovering money for the defrauded customers of swindler Bernard Madoff's firm has sued Kingate Global Fund Ltd, Kingate Euro Fund Ltd and Bank of Bermuda Ltd for the return of $255 million.

According to the lawsuit filed on Friday in U.S. Bankruptcy Court in New York, the funds received money transferred from Bernard L. Madoff Investment Securities LLC last October and November, just before Madoff's arrest in December on charges he ran the biggest investment fraud in Wall Street history.

The so-called feeder funds, the second to be sued by court-appointed trustee Irving Picard, are registered in the British Virgin Islands. On April 8, Picard sued Vizcaya Partners Ltd to try and recover $150 million it withdrew from the Madoff firm.

Madoff, a former non-executive chairman of the Nasdaq stock market, pleaded guilty on March 12 to running a global fraud involving as much as $65 billion over 20 years, including billions from "feeder funds".

Representatives of the Kingate funds and the bank could not be reached for comment.

The case is Picard v Kingate Global Fund Ltd et al 09-01161 U.S. Bankruptcy Court for the Southern District of New York (Manhattan)

(Reporting by Grant McCool, editing by Dave Zimmerman)