UPDATE 5-Bernard Madoff’s elder son dead in suicide

* Madoff family faces suits by trustee for investors

* Mark Madoff said distraught over speculation of charges
(Adds details on trustee’s lawsuits, background on Madoff
case)

By Martha Graybow and Daniel Trotta

NEW YORK, Dec 11 (BestGrowthStock) – Mark Madoff, the elder son of
convicted swindler Bernard Madoff, was found hanged in his New
York City apartment in an apparent suicide on the second
anniversary of his father’s arrest, police and his lawyer said
on Saturday.

The 46-year-old Mark Madoff, who had worked at his father’s
firm, “succumbed to two years of unrelenting pressure from
false accusations and innuendo,” his lawyer said. He was found
dead in his apartment in the city’s SoHo neighborhood, New York
City police spokesman Paul Browne said.

Bernard Madoff, 72, is serving a 150-year prison sentence
after confessing to running a decades-long Ponzi scheme that
bilked investors out of billions, considered the biggest
financial fraud in history.

“Mark Madoff took his own life today. This is a terrible
and unnecessary tragedy,” Martin Flumenbaum, a lawyer for Mark
Madoff and his younger brother, Andrew, said in a statement.
“Mark was an innocent victim of his father’s monstrous crime.”

Mark Madoff’s 2-year-old son was in the apartment when the
body was discovered by his father-in-law, said police at the
scene who declined to be identified.

The Madoff sons and other family members had worked for
Bernard L. Madoff Investment Securities LLC, which crumbled
when the Ponzi scheme was revealed. Bernard Madoff was arrested
on Dec. 11, 2008, after his sons turned him in to authorities.
The sons said Madoff had confessed the fraud to them a day
earlier.

Defrauded Madoff investors have long viewed the convicted
swindler’s sons, wife and other family members suspiciously,
arguing it is impossible that they did not know about his lies.
No family members have been criminally charged and they reject
accusations that they were aware of the fraud.

Mark Madoff, a married father of four, was distraught over
speculation about potential criminal charges against him, said
a person familiar with his activities but who was not
authorized to speak publicly about him. There was no indication
that any charges were imminent, the source said.

The Wall Street Journal reported in February that Bernard
Madoff’s sons and brother were the subject of criminal
tax-fraud probes by federal prosecutors in Manhattan.

Ira Lee Sorkin, a lawyer for Bernard Madoff, said Mark
Madoff’s death was “a great tragedy at many levels.” He
declined comment on whether he had spoken to Bernard Madoff,
who is in a North Carolina prison, about his son’s death.

Ruth Madoff, Mark’s mother, is “heartbroken,” her lawyer,
Peter Chavkin, said in an emailed comment.

In the past two years, Mark Madoff had not spoken with
either of his parents, the source close to him said. The person
said that Mark Madoff had tried unsuccessfully to get a Wall
Street trading job after his father’s arrest.

TRUSTEE’S LAWSUITS

Mark Madoff and other family members have been sued by the
court-appointed trustee trying to recover money for investors
defrauded in the Ponzi scheme, a fraud in which early investors
are paid with money from new ones. The schemes often collapse
when sufficient investors can’t be lined up or when a number of
investors want to cash out.

Trustee Irving Picard says they should have known about the
$65 billion fraud and must return money they used to support
lavish lifestyles, including luxury homes and expensive meals.

Earlier this week, the trustee also sued five Madoff
grandchildren, including children of Mark Madoff, for millions
purportedly transferred to them. The trustee has sued an array
of defendants for more than $50 billion in total, filing a
flurry of cases in recent days before the statute of
limitations expired this weekend. [ID:nN11140139]

In an October 2009 lawsuit, the trustee said Mark Madoff
and other family members who worked at the firm were
“completely derelict in duties and responsibilities.”

The trustee on Saturday called Mark Madoff’s death a tragic
development.

The Madoff scandal shook investors around the world and
sparked criticism of market regulators for failing to catch him
despite warnings and tips over many years.

For decades, investors big and small flocked to the New
York-based money manager, hoping to gain entree onto his
seemingly exclusive client list as he promised steady returns
that defied the broader markets. In reality, Madoff always was
seeking new investors to keep his scheme running.

Madoff has insisted he acted alone. Since he pleaded guilty
in March 2009, seven other people have been arrested in the
case, including several of his long-time employees and an
outside accountant.

Mark Madoff joined the firm in 1986, and he and his brother
Andrew went on to run the market making and trading arm of
Madoff’s business. The trustee says that while that part of the
business was ostensibly legitimate, they also played roles at
times in the fraudulent investment advisory unit.
(Reporting by Martha Graybow, Dan Trotta, Chris Michaud and
Grant McCool; Editing by Jackie Frank and Vicki Allen)

UPDATE 5-Bernard Madoff’s elder son dead in suicide