Assets of Madoff’s Brother Frozen Amid New Probe of Accused Wrongdoing

All financial assets of Peter Madoff, the brother of disgraced Wall Street swindler Bernard Madoff, have been ordered temporarily frozen by a New York judge due to an accusation that he mishandled a client’s $500,000 inheritance fund.

Peter Madoff, who was an executive in his brother’s financial firm, Bernard L. Madoff Investment Securities LLC, was the trustee of a trust for Andrew Ross Samuels, a New York City law student. Samuels said the money was left for him by his deceased grandfather, but after the funds were placed with Peter Madoff, they disappeared.

“Samuels’ grandfather passed away making Peter Madoff the trustee of a trust for him that’s worth about $500,000, and the money ain’t there,” said his lawyer, Steven Schlesinger. “When you are the trustee and the money’s not there, it’s per se liability.”

Bernard Madoff pleaded guilty on March 12 and admitted he orchestrated a $65 billion Ponzi scheme, the largest such fraud in Wall Street history. He faces up to 150 years in federal prison when he is sentenced June 16.

Samuels today asked for and immediately received a court order freezing all of Peter Madoff’s assets, although the precise amount and nature of those assets is not known. A hearing is scheduled for April 3 in Nassau County State Supreme Court on New York’s Long Island before Justice Stephen Bucaria, who signed the order.

Until then, Peter Madoff “is prohibited and restrained from removing any funds … from any bank, brokerage firm, or other institution wherever situated and without limitation,” according to the judge’s temporary order.

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