NY feds: Boston businessman giving up $625 million

By LARRY NEUMEISTER, Associated Press Larry Neumeister, Associated Press –
1 hr 25 mins ago

NEW YORK – A 97-year-old Boston-area apparel entrepreneur agreed Tuesday to forfeit $625 million to be distributed to cheated investors in jailed Bernard Madoff's historic Ponzi scheme, authorities revealed, as a court trustee said negotiations are under way to recover money as well from the owners of the New York Mets.

The U.S. government said in papers filed in federal court in Manhattan that Massachusetts businessman and philanthropist Carl Shapiro, one of the first investors in Madoff's investment business and a longtime Madoff friend, entered the forfeiture deal along with his partners.

The papers were filed by the government to recover the money from the accounts of JP Morgan Chase Bank, N.A. It said the proceeds would be distributed to Madoff investors. The papers said Shapiro held an account in his name with Madoff's investment business since 1961 and had controlled accounts for others from time to time. Madoff started his investment business in 1959.

That action proceeded as court-appointed trustee Irving Picard filed a complaint under seal in U.S. Bankruptcy Court to recover money from Sterling Equities, along with its partners and family members. Picard said his office was "engaged in good-faith negotiations" with the Sterling defendants, who include the owners of the New York Mets baseball team.

In a statement of its own, Sterling agreed with Picard that the sealing of his lawsuit was necessary because the parties are negotiating a settlement.

It added: "Regardless of the outcome of these discussions, we want to emphasize that the New York Mets will have all the necessary financial and operational resources to fully compete and win. That is our commitment to our fans and to New York."

The trustee overseeing jailed financier Bernard Madoff's assets has labeled the New York Mets winners in the epic fraud.

A year ago, Picard said in a bankruptcy filing that the Mets made nearly $48 million in Madoff's scheme. He said the Mets Limited Partnership originally invested about $523 million, but eventually withdrew about $571 million from the accounts.

The latest actions come as a deadline approaches this weekend to file court papers before the revelation of the fraud reaches two years.

In December 2008, Madoff revealed to his sons and later to the FBI that he had operated a bogus investment business for decades, reporting to investors that their $21 billion had risen in value to more than $65 billion when it actually had dwindled to just a few hundred million dollars. The 72-year-old Madoff is serving a 150-year prison term after pleading guilty to fraud.

A spokesman for Shapiro did not immediately return a phone message for comment.
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Associated Press writers Tom Hays and Ron Blum contributed to this story.

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