More On Legal & Compliancefrom The Advisor's Professional Library
- Whistleblowers A whistleblower is any individual providing the SEC with original information related to a possible violation of federal securities law. The Dodd-Frank Act established a whistleblower program that enables the SEC to reward individuals who voluntarily provide such information.
- Code of Ethics Rule The Code of Ethics Rule, found in Rule 204A-1, uses severe consequences for violation to help ensure investment advisors will do the right thing.
The controversy over the Mets owners’ involvement with the con man Bernie Madoff came to a swift and sudden end on Monday as a settlement was reached just before trial.
The owners, Fred Wilpon and Saul Katz, agreed to pay $162 million to the Madoff trustee Irving Picard, according to a story from MLB.com posted on the Mets’ website.
According to the story, Wilpon and Katz will not pay anything for three years.
Jury selection was scheduled to begin Monday for a trial that was to determine whether Wilpon and Katz could prove they were not "willfully blind" to Madoff's scheme, for which Madoff is serving a 150-year sentence at a North Carolina federal prison.
Judge Jed Rakoff ruled earlier this month that Wilpon and Katz would have to forfeit as much as $83 million in allegedly ill-gotten gains and go to trial over another $303 million.
The $162 million settlement figure is a total figure that includes the $83 million. Moreover, the Mets owners can recover that money through their own claims, totaling $178 million, against the Madoff estate.
"In a sense, we're now partners," David J. Sheehan, a lawyer for Picard, told The Associated Press outside the courthouse.
Picard had said that the Mets owners knew, or should have known, that Madoff's investment scheme was a fraud.
"Now I guess I can smile. ... Maybe I can take a day off," Wilpon said, according to the AP. "I am very, very pleased for ourselves and our families. This was really a team effort."
Rakoff said Picard had reviewed the evidence and would no longer pursue a claim of "willful blindness" against the defendants.