NYU Sues Merkin Over Madoff Losses

Dec 29 2008 | 3:26am ET

The holiday season has not been very festive for J. Ezra Merkin, the GMAC Financial chairman whose hedge fund lost billions in Bernard Madoff’s alleged $50 billion Ponzi scheme. Merkin got a very unwelcome early Christmas present from New York University, which sued him, his Gabriel Capital and his Ariel Fund hedge funds on Christmas Eve.

NYU, the largest private university in the U.S., said it lost $24 million due to Merkin’s investments with Madoff. The school accused Merkin of investing with Madoff without notifying investors and of due diligence failures.

When Merkin suggested investing some of NYU’s assets with Madoff, “he as explicitly told this was not a proper investment vehicle,” NYU alleged in a statement. The school said it had $94 million invested in Ariel.

NYU’s complaint, the second filed by a New York City university against a Madoff investor, was filed in New York state court in Manhattan.

Madoff was arrested on Dec. 11 and charged with securities fraud in what could be the largest-ever Ponzi scheme.


In Depth

Q&A: Quad Advisors’ Borish Is Looking For Real Traders, Not Index Huggers

Aug 20 2014 | 1:43pm ET

Peter Borish, who served as founding partner and director of research at Tudor Investment...

Lifestyle

Viking Manager In Rent Dispute

Aug 11 2014 | 4:14am ET

A hedge fund manager is demanding most of his money back from his former landlord...

Guest Contributor

Majority Of Inflows Go To Brand Name Hedge Funds

Aug 12 2014 | 9:00am ET

Since the market correction of 2008, a vast majority of hedge fund net asset flows...

 

Editor's Note

 

Futures Magazine

PREVIEW July/August 2014 Cover

Inside Futures' 500th Issue

The July/August 2014 issue is our largest in years—filled with the best trading strategies and stories from 43 years of being the primary publication for commodity, stock, options and forex traders.

The Alpha Pages

TAP July/August 2014 Cover

Real talk on alternative investments, business & finance

The Alpha Pages Editor's Note