Madoff scammed 120 Queens clients: Court papers

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About 120 accounts from individuals, families, businesses and trusts in 22 neighborhoods of Queens were ensnared in the $50 billion Ponzi scheme created by borough native Bernard Madoff, according to documents filed in bankruptcy court in Manhattan.

That number is sure to be higher since the filing only disclosed those who have come forward so far as victims. Madoff investors have until July 1 to register with a government entity responsible for compensating victims with up to $250,000.

The court−appointed trustee who is handling Madoff’s finances said last week there were no indications the Queens native ever invested his clients’ funds and contended that the fraud was a Ponzi scheme, where the perpetrator makes payments to early investors using funds from newer clients.

But Madoff’s victims were led to believe he was investing their money, where their return on investment was up to 20 percent, a figure that continually outperformed the market.

Forest Hills, an affluent, heavily Jewish neighborhood, was the hardest hit with 24 accounts, according to the bankruptcy documents.

Madoff, who grew up in Laurelton and worked as a lifeguard in the Rockaways as a young man, is Jewish and a large portion of his clients are Jews. He turned himself in to the FBI in December and admitted losing $50 billion of his clients’ money, the criminal complaint said.

He has yet to be indicted.

At North Shore Towers, an 1,800−unit luxury co−op in Floral Park, there were roughly 15 victims.

Barbara Leonardi, president of the North Shore Towers Shareholders Associations, said the $50 billion fraud has devastated the community, which is mostly comprised of retirees.

“We already have people moving out,” Leonardi said. “I’m expecting [Madoff] to have a major impact, absolutely.”

In Bayside, there were 19 victims, mostly individuals and trusts.

Fred Wilpon, co−owner of the New York Mets, is among some of the high−profile Madoff victims, who included Holocaust survivor and author Elie Wiesel’s foundation, actor Kevin Bacon and New York Daily News Publisher Morton Zuckerman.

In Flushing, where the Mets play their home games, there were 15 victims, including the New York Mets Foundation, Mets Limited and Sterling Doubleday Enterprises.

Other neighborhoods affected by the Ponzi scheme were Howard Beach (nine victims), Jamaica (six), Woodside (four), Astoria (three) and Jackson Heights (three).

Glendale, Kew Gardens, Rego Park, Jamaica Estates, Middle Village, Sunnyside, New Hyde Park and Queens Village all had two victims. There were one apiece in Whitestone, Fresh Meadows, Ozone Park and Douglaston.

Irving Picard, the trustee of Madoff’s accounts, said in court papers that investigators were looking through an Elmhurst dumpster that contains information on how Madoff was allegedly running the scheme.

Meanwhile, Picard said he has recovered roughly $530 million in funds to be used to return to investors. But that sum represents only 10 percent of the $50 billion fraud, according to court papers.

Reach reporter Howard Koplowitz by e−mail at or by phone at 718−229−0300, Ext. 173.

Posted 6:36 pm, October 10, 2011
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