Madoff trustee wins $180M from hedge fund

The trustee for Bernard Madoff’s investment-advisory business won a $180 million default judgment against Vizcaya Partners Ltd. over claims the hedge fund profited from the conman’s fraud. Vizcaya, based in the British Virgin Islands, failed to plead its case “or otherwise defend itself” against trustee Irving Picard’s allegations, according to an Aug. 3 ruling by U.S. Bankruptcy Judge Burton Lifland in Manhattan. Vizcaya, which opened an account with Madoff in 2001, missed a deadline to respond to the April 2009 lawsuit accusing it of taking fake profit from the fraud. The default applies to Vizcaya and its affiliates, Zeus, Siam and Asphalia. Picard has recovered more than $1.5 billion for Madoff victims. His lawsuits seek another $15 billion from funds that funneled money to the fraud, as well as Madoff’s friends and family. Madoff, 72, pleaded guilty last year and is serving a 150-year sentence for running the largest Ponzi scheme in U.S. history. Recovery of Vizcaya’s damages may hinge on a ruling by the Supreme Court of Gibraltar, which is holding about $74 million on behalf of the hedge fund’s bank, Banque Jacob Safra (Gibraltar) Ltd. The default doesn’t apply to the bank, which was also sued by Picard and is challenging the claims. Vizcaya’s lawyer, Anthony Paccione of Katten Muchin Rosenman LLP in New York, didn’t immediately return a call for comment.