Bernie Madoff's wife agrees to pay victims US$600,000 to settle lawsuit

The wife of Bernie Madoff (above) has been living quietly out of the public eye since her husband began serving a 150-year prison term.
The wife of Bernie Madoff (above) has been living quietly out of the public eye since her husband began serving a 150-year prison term. PHOTO: REUTERS

NEW YORK (BLOOMBERG) - Bernie Madoff's wife agreed to give victims of her husband's Ponzi scheme almost US$600,000 (S$818,000) to settle a decade-long lawsuit by a trustee who claimed she profited from the fraud.

Ruth Madoff, who's been living quietly out of the public eye since her husband began serving a 150-year prison term, also agreed to transfer all her remaining assets to a fund for victims after she dies, according to settlement papers filed May 3 in New York by the trustee, Irving Picard.

Under the terms of the deal, Ruth Madoff will make an upfront cash payment of US$250,000 to Picard and transfer another US$344,000 from two other accounts she had set up for two of her grandchildren. She also agreed to cooperate with the Securities Investor Protection Corp., the industry-backed regulator that hired Picard and still has at least 100 other lawsuits pending.

Her lawyer, Peter Chavkin, didn't immediately return a call for comment.

The settlement was reported earlier by the Wall Street Journal.

Picard's lawsuit accused Ruth Madoff of getting US$44 million in phony profit from her husband's US$20 billion Ponzi scheme. Under an earlier settlement with federal prosecutors the couple forfeited their homes, financial holdings and other property, but Ruth Madoff was allowed to keep US$2.5 million. That deal didn't preclude the trustee from going after the money.

So far the trustee has recovered more than US$13 billion through settlements and distributed more than $12 billion to victims - significantly more than some predicted a decade ago.