Madoff Apt. Sold, Family Members Accept Asset Freeze

Feb 9 2010 | 11:41am ET

Last week was a busy one in the disposition of Madoff family assets.

After five months on the market, the Manhattan home of arch-fraudster Bernard Madoff has found a buyer. The 4,000-square-foot penthouse on Manhattan’s Upper East Side fetched $8.9 million; the U.S. Marshals Service, which sold the apartment through Sotheby’s International Realty, was originally seeking $9.9 million.

The buyer is reportedly Alfred Kahn, the CEO of toy company 4Kids Entertainment, which makes Cabbage Patch Kids and Pokemon toys. Kahn still needs approval of the building’s board before he can move in to the three-bedroom, four-bathroom apartment on East 64th Street.

The Manhattan apartment is the second of Madoff’s three homes to be sold. In October, his beach house in Montauk. N.Y., fetched $9.41 million from Vornado Realty Trust Chairman Steven Roth. Madoff’s Palm Beach, Fla., mansion is still on the market; it’s price has been cut to $7.25 million from $8.49 million. Madoff, for his part, now resides in a federal correction facility in North Carolina, were he is serving a 150-year sentence for running a $65 billion Ponzi scheme.

Meanwhile, the court-appointed receiver liquidating Madoff’s other assets has won an asset-freeze agreement with Madoff’s two sons, brother and niece.

Irving Picard is suing the family foursome for $199 million, alleging they treated Bernard L. Madoff Investment Securities as “the family piggy bank.” All four deny the charges, saying they agreed to the restrictions because “the potential costs and expenses” of fighting the asset freeze could have been “substantial.”

Under the agreement, Andrew, Mark, Peter and Shana Madoff are barred from selling, leveraging, wasting or moving any property worth more than $1,000, with one restriction: They are allowed to wear “personal clothing and jewelry in the normal course.” They must take steps to preserve the value of their property and a forbidden from incurring debts of more than $1,000. The four are also required to present monthly accounting of their expenses, documenting anything that costs more than $500.

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