Madoff beneficiary Barbara Picower to return $7bn
- 17 December 2010
- From the section Business
The widow of a businessman who had been the single-largest beneficiary of Bernard Madoff's colossal Ponzi scheme has agreed to return $7.2bn (£4.5bn).
Barbara Picower said Madoff's fraud was "deplorable" and promised to return money accrued over 35 years of investing with Madoff.
The trustee recovering Madoff's bogus profits filed court papers on Friday formalising the settlement.
Florida businessman Jeffry Picower drowned after a heart attack in 2009.
US Attorney Preet Bharara called the settlement a "game changer" for Madoff's victims, many of whom lost their life savings.
The $7bn amounts to about one-third of the money investors' lost in the scandal.
Mrs Picower said: "We will return every penny received from almost 35 years of investing with Bernard Madoff.
"I believe the Madoff Ponzi scheme was deplorable and I am deeply saddened by the tragic impact it continues to have on the lives of its victims.
"It is my hope that this settlement will ease that suffering," she said.
Mr Picower, who was 67 when he died in his swimming pool, was one of Madoff's oldest clients.
The money was supposedly made on share trading, but investigators said that in reality it was simply stolen from other investors.
The Picower estate's lawyers claimed he knew nothing about the fraud, but victims' lawyers argued that he must have known that the investment returns were "implausibly high".
Mrs Picower said in a statement that she was "absolutely confident that my husband Jeffry was in no way complicit in Madoff's fraud".
Madoff admitted last year to defrauding thousands of investors through a Ponzi scheme, which paid out using new investors' money rather than from any profits.
The scheme, which had been running since the early 1990s, unravelled when Madoff's investors tried to withdraw about $7bn at the height of the economic downturn. Madoff could not produce the money.
Madoff is serving 150 years for the fraud.