NYT: NY AG Issues Subpoenas To Determine If Financier Defrauded Universities and Charities By Investing With Madoff

The New York Times reports that New York attorney general, Andrew M. Cuomo, issued subpoenas last night in an effort to determine if the financier, J. Ezra Merkin, defrauded universities and charities when he invested their money with Bernard L. Madoff. Cuomo’s office is seeking information from Merkin, three investment funds that he operated, and 15 nonprofit institutions that gave him money to manage. Many of the institutions are now suing Merkin, claiming that they lost millions of dollars when he invested money with Madoff without their knowledge. According to the NYT, the investigation would examine whether Merkin properly disclosed where the money was being invested. The institutions are being asked to provide information about how they were affected by the Madoff scandal.

Merkin has portrayed himself as a victim of Madoff in letters to investors and one of Merkin’s lawyers said he will fully cooperate with any investigation. Many institutions that lost money through Merkin were ones in which he played a prominent role, often sitting on boards and offering financial advice. Among the institutions receiving subpoenas are New York University, New York Law School, Yeshiva University, the Levy Economic Institute at Bard College and the Ramaz School. Tufts University, which is considering litigation, lost $20 million. New York University is suing over the loss of $24 million, and New York Law School has filed suit over a $3 million loss. Yeshiva University has said that it lost $110 million invested with Merkin, and Bard College estimates its loss at $11 million.

SS