(November 14, 2012) — The Department of Labor (DoL) has settled with four companies to resolve a string of lawsuits over losses from investments in Bernard L. Madoff Securities’ Ponzi scheme.
The amount of the settlement: $217 million. It is currently pending approval by the US District Court in New York.
According to a statement by the DoL, the settlement was reached with Ivy Asset Management, which is a unit of the Bank of New York Mellon, along with JP Jeanneret Associates, Beacon Associates Management, Andover Associates Management, and their former and current owners and executives. The suit alleged the four firms and their owners and principals “misrepresented and concealed doubts and suspicions” about investment in the Madoff trading strategy.
The DoL sued the firms for alleged violations of the Employee Retirement Income Security Act. The suit alleged that they “breached their fiduciary duties to a number of benefit plans by recommending, making and maintaining investments with Madoff, thus losing hundreds of millions of dollars in assets needed for the pension and health benefits of thousands of workers.”
The statement notes that Ivy Asset Management and defendants Lawrence Simon, Howard Wohl, Adam Geiger and Larry Fred Sloan agreed to pay $210 million. Jeanneret and its owners, John P. Jeanneret and Paul Perry, agreed to pay $3 million, and Beacon owner Joel Danzinger and Harris Markoff, owner of Andover, agreed to pay $3.5 million and drop a claim of $3.3 million for management fees.
“The settlement agreement we’re announcing today provides a measure of justice for those Americans who worked hard to prepare for their retirement and then saw hoped-for stability disappear,” said Secretary of Labor Hilda L. Solis in the statement. “My department is committed to ensuring that workers and retirees receive the benefits they’ve earned and deserve. If approved by the court, this settlement, combined with expected payments from the Madoff bankruptcy estate, will allow worker benefit plans impacted by Bernard Madoff’s illegal and reprehensible scheme to recover all, or nearly all, of the money they invested with him.”
Ivy Asset Management’s Chief Restructuring Officer and Chief Investment Officer Douglas W. Squasoni said in a statement that “Ivy is pleased to have reached an agreement that allows it to put these matters behind it.”