Judge To Rule On Removing Merkin

Feb 19 2009 | 12:55am ET

The judge overseeing a lawsuit against Bernard Madoff feeder hedge fund manager J. Ezra Merkin says he plans to rule soon on whether Merkin should be allowed to remain at his firm’s helm.

New York University, which says it lost $24 million it invested with Merkin in the Madoff scandal, has asked New York State Supreme Court Justice Richard Lowe to remove Merkin as manager of his Ariel Fund and appoint a liquidator to sell off its assets. Ariel and Merkin’s other two funds had more than $2 billion invested with Bernard L. Madoff Investment Securities.

Lowe says he plans to rule on the motion soon.

“Merkin garnered hundreds of millions of dollars of fees by violating the trust of investors,” NYU alleged in a court filing. “There is no reason to believe that he will alter his cynical approach to his fiduciary obligations if he is left in control of Ariel’s remaining assets.”

For his part, Merkin has suggested an “oversight committee” to wind down the funds over the next several years. At a hearing on Tuesday, a lawyer for NYU called the proposed committee “simply figureheads” that leave Merkin with complete control.


In Depth

Exotic Assets: Investing In Rare Violins

Jan 17 2017 | 4:43pm ET

By definition, alternative investments include exotic assets far beyond your typical...

Lifestyle

'Tis the Season: Wall Street Holiday Parties Back In Fashion

Dec 22 2016 | 9:23pm ET

Spending on Wall Street holiday parties has largely returned to pre-2008 levels...

Guest Contributor

DarcMatter: The Top Trends in Alternative Investments for 2017

Jan 13 2017 | 8:22pm ET

The $7 trillion alternative investments industry is poised for continued growth...

 

From the current issue of

The U.S. Commodity Futures Trading Commission (CFTC) ordered The Goldman Sachs Group Inc., and Goldman, Sachs & Co. to pay a $120 million penalty for attempted manipulation and false reporting of ISDAFIX Benchmark Rates, a global benchmark for interest rate products.