The trustee appointed to liquidate the assets of Bernard L. Madoff Investment Securities LLC to return money to the victims of businessman and Ponzi schemer Bernie Madoff has filed a $95 million lawsuit against some of the largest educational and medical institutions in Israel.
Madoff was sentenced to 150 years in prison in 2009 for defrauding thousands of investors out of a total of $65 billion. The trustee, Irving Picard, alleges that though the institutions unknowingly accepted stolen money from Madoff as donations before his scheme came to light, it is now their responsibility to return it to the victims, which they have refused to do, he says.
Among the defendants in the case are the Hebrew University of Jerusalem, which is being sued for $36 million; Ben-Gurion University of the Negev, being sued for $18 million; the Weizmann Institute, being sued for $13 million; Bar-Ilan University, being sued for $10 million; Tel Aviv University, which is being sued for $6.5 million; and Sheba Medical Center, being sued for $2.3 million.
Picard filed the lawsuit through attorneys Jonathan Agmon and Ady Norman from the Israeli law firm Soroker and Agmon. The institutions apparently received the funds through the Yeshaya Horowitz Association. Picard alleges that the association transferred some $123 million in funds defrauded from Madoff’s investors, much of which it then distributed to Israeli institutions.
The Israeli business news website Globes reported Picard as saying that “the facts establishing the grounds for the claim explain how the innocent Madoff victims’ money was given to hospitals and universities in Israel in the form of ‘donations’ and ‘grants.’ The money from theft and fraud was laundered through the respondents, who are now refusing to restore the money to its legal owners—Madoff’s victims.”
According to the Globes report, the Association of University Heads of Israel said in a statement that the universities did not know about the Yeshaya Horowitz Association’s investments and that the money, which “was legally donated to universities,” had already been used for research.