Madoff Heads to Court, Trustee Sends Out Claim Forms

Photograph of Bernard Madoff last month by Jason DeCrow/AP

Bernard Madoff, who says his investment business was actually a Ponzi scheme estimated at $50 billion, is scheduled to appear in court today for a bail hearing. Bloomberg News reports, "The government may ask that Madoff’s bail conditions be modified, including that bail be withdrawn and the former executive imprisoned." Madoff is currently on $10 million bond and is under house arrest at his East 64th Street penthouse apartment.

UPDATE: Madoff remains free! Bloomberg News reports that even though Madoff apparently "transferr[ed] $1 million of valuables in violation of an asset freeze order," he's still walking around (in his apartment... or to and from court hearings). The U.S. Attorney's office says that Madoff mailed items, including jewelry, to relatives. Madoff's lawyer says his client was just sending them to his brother.

The trustee overseeing the liquidation of Madoff's investment firm has sent out "8,000 claim forms to its customers as they seek to recover collectively billions," according to Dealbook. The Daily Intel tried to break down where the billions could have gone—Madoff apparently liked vintage watches and would buy wedding bands "to match the color and design of each watch" as well as throwing elaborate million parties.

Patrick Littaye of Access International Advisers boo-hoos to Bloomberg News about losing all his savings from investing solely with Madoff. Littaye was "enticed by the firm’s positive returns as other hedge funds slumped. His error was compounded because he borrowed money to increase the return on his investment, leaving him with $4 million in personal debts." He says he'll subsist on French social security payments. Keep in mind that Littay'e partner, Rene-Thierry Magon de la Villhuchet, killed himself when he realized that he failed their clients.

Congress is holding hearings about how Madoff was able to get away with his scam—Rep. Paul Kanjorski (D-PA) said, "Clearly our regulatory system has failed miserably and we must rebuild it now." The Wall Street Journal suggests mutual funds may seem more attractive.