New York's attorney general today announced a settlement of more than $210 million with Ivy Asset Management LLC, a Bank of New York Mellon Corp. subsidiary that advised clients to invest with convicted investment adviser Bernard Madoff.
"Today's settlement brings accountability for one of the worst financial frauds in American history, and justice to defrauded investors," New York Attorney General Eric Schneiderman said in a release. "We have recovered over $210 million for the victims who were harmed as a result of the world's most notorious Ponzi scheme."
The settlement concludes lawsuits against Ivy by Schneiderman, the U.S. Department of Labor and private plaintiffs, and provides for the payment of $210 million by the firm and approximately $9 million by other defendants.
When added to future amounts Madoff investors anticipate receiving from the Madoff bankruptcy proceedings, today's settlement is expected to return all or nearly all the original investment to those defrauded by the Ponzi scheme in this case.
Between 1998 and 2008, Ivy was paid more than $40 million to give advice and conduct due diligence for clients with large Madoff investments. Ivy's due diligence revealed that Madoff was not investing his funds as advertised.
Ivy Asset Management "violated its fundamental responsibility as an investment adviser by putting its own pecuniary interests ahead of the interests of its clients," Scheiderman said.