Madoff Trustee UPS The Ante To $19 Billion From Jp Morgan For

The trustee who is liquidating the Bernard Madoff firm, Irving Picard, has up the ante against JP Morgan Chase & Company increasing the damages from $5.4 billion to a minimum of $19 billion for being "an active enabler of the Madoff Ponzi scheme," according to Bloomberg News. Picard had originally sought $5.4 billion in damages, plus $1 billion in transfers and claims. One of the attorneys working with Picard, David Sheehan, said in a prepared statement that JP Morgan "not only should have known that a fraud was being perpetrated, they did know."

There have been some 1,000 lawsuits filed by Mr. Picard seeking $90 billion in damages for harmed investors. The Wall Street bank which was Madoff's primary financial institution, was sued in December 2010 alleging that the bank ignored the signs of fraud while billions of dollars flowed from his account to investors. Another attorney working for Picard said that "JP Morgan's bankers could see that money customers deposited into Bernard L. Madoff Investment Securities LLC's (BLMIS) main account was not being used to purchase or sell securities" and "they could see that it was merely transferred to other customers, in patterns serving no legitimate business purpose. They could see that Madoff's regulatory filings were materially inconsistent with BLMIS's actual finances. Yet, as alleged, they allowed the fraud to continue."

JP Morgan had filed a motion to dismiss the Picard lawsuit. It was amended to add names of JPM bankers who had discussed the possibility that Madoff was running a Ponzi scheme. Picard and Judge Colleen McMahon are sparring with each other over technicalities and Picard has until June 24, 2011 to further amend his complaint but she is dead set on not prolonging the present court schedule.

In related matters, Judge Jed Rakoff is set to rule on a request to dismiss the trustee's $9 billion lawsuit against HSBC Holdings PLC and a $59 billion case filed against Italy's UniCredit SpA, a defendant with Bank Medici AG and founder Sonja Kohn.

Since Madoff was arrested in 2008, Picard has recovered $7.6 billion for investors, or 44% of the estimated $17 billion of lost principal, which is not yet available for distribution to those harmed. Picard's firm, Baker & Hostetler LLP has charged more than $175 million in legal fees to date.

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