U.S. District Judge Victor Marrero has given final approval to a $55 million settlement between PricewaterhouseCoopers LLP (PwC) and investors in Bernie Madoff’s Ponzi scheme. It was alleged that the audit firm had ignored red flags. This settlement winds up the litigation against entities that provided services to Madoff feeder funds. The total recovery is $235 million. Judge Marrero said the seven-and-a-half-year-old litigation was a “long road,” but that the PwC settlement was a good one.
The total recovery comes from settlements with PwC, Fairfield Greenwich Ltd., GlobeOp Financial Services LLC and Citco Group Ltd. An additional $30 million recovery is possible, pending the outcome of litigation brought by the trustee overseeing the liquidation of Madoff’s defunct brokerage. The litigation is in relatively early stages. Named Plaintiffs Pasha and Julia Anwar filed suit against PwC in 2008, claiming that the company was negligent in its auditing of funds invested in Madoff’s investment company and failed to recognize red flags that would have revealed the Ponzi scheme.
The class of about 1,000 people and businesses that lost about $7.5 billion following Madoff’s collapse settled with PwC just before the case was slated for trial. The case is in the U.S. District Court for the Southern District of New York.
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