Senator Frank R. Lautenberg, whose family foundation lost around $15.4 million to Bernie Madoff, has filed a lawsuit on behalf of the foundation against Peter Madoff, Bernie's brother and the firm's senior managing director, for negligence, breach of duty, and aiding and abetting his brother. Peter couldn't have not known, the plaintiffs allege, and lay out seventeen “obvious, material red flags” that they believe should have alerted anyone to the possibility of fraud. It's pretty convincing — especially, we think, this bit:
BMIS employees were not allowed to enter the 17th floor of the BMIS offices, referred to as "the Cage" wherein the fraudulent BMIS investment advisory services were conducted.
THE CAGE. They might as well have called it the Chamber of Horrors.
Madoff’s Brother Sued by Lautenberg Foundation [DealBook/NYT]
Related: The Monster Mensch [NYM]