| June 30
June 30 Victims of the Ponzi schemes of Bernard
Madoff and Allen Stanford, two of the largest in U.S. history,
suffered setbacks on Monday as the U.S. Supreme Court refused to
hear appeals in two cases seeking to recoup more money for them.
In the Madoff case, the court rejected a request by Irving
Picard, the trustee liquidating Bernard L. Madoff Investment
Securities LLC, to review the dismissal of his claims against
banks he accused of enabling Madoff's fraud.
Separately, the court rejected a request by Ralph Janvey, a
receiver unwinding Stanford's businesses, to review a ruling
that blocked him from pursuing claims against Stanford employees
on behalf of the receivership's creditors, not the businesses
In both cases, lower courts concluded that Picard and Janvey
lacked standing to bring their respective claims.
The Supreme Court did not give reasons for its decisions,
which leave intact a June 2013 ruling in the Madoff case by the
federal appeals court in New York, and an August 2013 ruling in
the Stanford case by the federal appeals court in New Orleans.
Representatives for Picard and Janvey were not immediately
available to comment.
Picard has recovered about $9.82 billion for former Madoff
customers, who he has estimated lost $17.5 billion of principal
in a decades-long fraud uncovered in December 2008. A Ponzi
scheme is one in which the early investors are usually paid high
returns using money from later investors.
Picard had sued banks including JPMorgan Chase & Co,
Britain's HSBC Holdings Plc, Italy's UniCredit SpA
and Switzerland's UBS AG over their dealings
JPMorgan, which was Madoff's main bank, was dropped from the
case after reaching a $325 million settlement with Picard in
January, part of a $2.6 billion global resolution of federal and
private Madoff claims.
Stanford's estimated $7.2 billion fraud was based on the
sale of bogus certificates of deposit issued by Antigua-based
Stanford International Bank to customers who thought the CDs
were safe. The Ponzi scheme was uncovered in February 2009.
Janvey won court approval for an initial $55 million
distribution to CD investors in April 2013.
Madoff, 76, is serving a 150-year prison term after pleading
guilty in March 2009. Stanford, 64, is serving a 110-year term
following his jury conviction in March 2012.
The cases are Picard v. JPMorgan Chase & Co et al, U.S.
Supreme Court, No. 13-448; and Janvey v. Alguire et al, U.S.
Supreme Court, No. 13-913.
(Reporting by Jonathan Stempel in New York; Editing by Grant