04:17
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NEW YORK (Reuters) – the trustee seeking money for the victims of Bernard Madoff is now demanding 19 billion dollars in damages from JPMorgan Chase & Co, tripling over what he hopes to recover from what had been the main Bank for the Ponzi Schemer now-imprisoned.
The amended complaint by the trustee Irving Picard adds new taxes and was filed three days after the second-largest u.s. Bank has agreed to pay $ 153.6 million to settle u.s. Securities and Exchange Commission fraud charges.
Picard claimed that JPMorgan was "completely complicit" Madoff fraud and ignored red flags. In his original complaint, made public in February, he had tried to 6.4 billion, including $ 5.4 billion in damages and $ 1 billion for loans and fraudulent transfers.
"JPMorgan Chase has chosen to enable the Madoff fraud, not only through the various ways that participated in its activities, but helping to cover theft naked Madoff with the imprimatur of a financial institution recognized worldwide," said the 155-page report.
The demand for higher damages reflects "damage life-to-date", or what the trustee considers minimum losses over the entirety of the Madoff Ponzi scheme.
Picard is also looking for at least 500 million dollars that JPMorgan did "out behind the victims of Madoff" and more than 400 million dollars in alleged fraudulent transfers.
Tasha Pelion, a spokesman for JPMorgan Chase, repeated in an email of previous Bank statement that the complaint is meritless lawsuit Picard and distorts the facts and the law.
"JPMorgan Chase does not know or otherwise become a party to the fraud orchestrated by Bernard Madoff," he said. "At all times fully respected, JPMorgan all laws and regulations of bank accounts."
Picard has presented approximately 1,050 lawsuits seeking more than 100 billion dollars for investors of Bernard l. Madoff Investment Securities LLC.
"BEFORE THEIR EYES"
JPMorgan amended complaint adds new accusations that another financial company around 1997 suspect transfers daily nearly 1 million dollars to 10 million dollars between Madoff account there and his account in pursuit of services.
It said the company asked employees Madoff about suspicions transfers back and forth. Having failed to be satisfied on them, have closed account Madoff said.
"Bankers of JPMorgan Chase literally watched fraud unfolding before their eyes," Deborah Renner, a lawyer representing Picard, said in a statement. Both are partners at the law firm of Baker Hostetler &.
The amended complaint also discusses a longstanding relationship with Sterling Equities of Madoff, a private banking client of JPMorgan founded by Fred Wilpon and Saul Katz, owners of the baseball team New York Mets.
Picard sued the owners of the Mets for 1 billion dollars, prompting them to enter talks to sell part of the team of hedge fund manager David Einhorn for 200 million dollars. [ID: nN26247232] The owners have denied knowing that Madoff was committing fraud.
In a regulatory filing last month, JPMorgan estimates that by 31 March, you may need to pay off as more than 4.5 billion dollars for litigation that it had put aside for this purpose. It also said more than 10,000 of the facing legal proceedings.
ESA agreement Tuesday resolved charges that JPMorgan has told investors that a hedge fund has helped shape — and then bet against-complex mortgage securities bought.
HSBC, UNICREDIT BANCA, DOCTORS ALSO SUED
Picard's case against JPMorgan is under the supervision of the United States District Judge Colleen McMahon.
It is one of three high-profile causes Madoff who were moved to the Federal District Court, where juries can hear cases, bankruptcy court, where originally cited Picard.
United States District Judge Jed disaster film is reviewing some of the problems in the case of 9 billion Picard against HSBC Holdings Plc.
Disaster film is considering even if the trustee can invoke the law of racketeering in a lawsuit of $ 58.8 billion against UniCredit SpA of Italy, Bank AG of Austria, including doctors and its founder Sonja Kohn and other defendants.
JPMorgan has until 1 August to respond to the complaint, said Picard.
Madoff, 73, was arrested on December 11, 2008, and after pleading guilty, is serving a prison sentence of 150 years.
JPMorgan shares fell 16 cents in after-hours trading, after closing session Friday, down 58 cents at $ 39.49.
The cases are Picard v. JPMorgan Chase & Co. et al., the United States Bankruptcy Court, Southern District of New York, no. 10-ap-04932; JPMorgan Chase and v. & Co. et al., U.s. District Court, Southern District of New York, no. 11-00913 Picard.
(Reporting by Jonathan Stempel in New York and Jochelle Mendonca in Bangalore; editing by Andre Grenon, Gary Hill)
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