Defendant Admits Causing Inaccurate Submissions to the Fund and Agrees to Pay $2.5 Million
Damian Williams, the United States Attorney for the Southern District of New York, and Richard C. Breeden, Special Master of the Madoff Victim Fund (“MVF”), announced today that the United States has filed and settled a civil fraud lawsuit against FULCRUM CAPITAL PARTNERS LLC (“FULCRUM”), an investment firm based in Austin, Texas, alleging that FULCRUM fraudulently obtained payments from the MVF, an entity created by the Department of Justice (“DOJ”) to distribute funds collected by the United States through civil and criminal asset forfeiture to victims of the fraud perpetrated by Bernard L. Madoff. Specifically, the United States alleges that FULCRUM, in violation of the False Claims Act, purchased recovery rights from various Madoff fraud victims who had submitted claims to the MVF and required the Madoff fraud victims to conceal these transactions from the MVF. As a result, FULCRUM caused the MVF to make inflated payouts to the victims, which they paid over to FULCRUM. Under the settlement, submitted today to U.S. District Judge Valerie E. Caproni for review and approval, FULCRUM will pay $2,511,084 to the United States. FULCRUM also made extensive factual admissions regarding its conduct, including that it caused inaccurate statements to be submitted to the MVF and received amounts from the MVF to which FULCRUM was not entitled.
U.S. Attorney Damian Williams said: “The Madoff...
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