Madoff victims' trustee sues JPMorgan

NEW YORK, Dec. 2 (UPI) -- A trustee for victims of Bernard Madoff's Ponzi scheme sued JPMorgan Chase Bank for $6.4 billion in New York Thursday, alleging it profited from Madoff's fraud.

The suit, filed in federal bankruptcy court by Irving H. Picard, seeks to recover nearly $1 billion in profits and fees, and $5.4 billion in damages, The New York Times reported.

Madoff is a former stock broker and investment adviser who admitted to operating what has been called the largest financial fraud scheme in history. He was sentenced to a maximum sentence of 150 years in prison.

Picard sued UBS Wealth Management of Switzerland and its affiliate feeder funds last week, alleging the bank profited from Madoff's fraud in its role as the sponsor of the international feeder funds that funneled investors' money to Madoff, the Times reported.

The suit against JPMorgan was filed under seal but Picard's lawyers said the complaint alleges JPMorgan disregarded "clear, documented suspicions" about the legitimacy of Madoff's business and should have detected illegal cash flows pertaining to Madoff's fraud.

"Madoff would not have been able to commit this massive Ponzi scheme without this bank," said David Sheehan, one of Picard's lawyers.

JPMorgan said Picard's claims were "irresponsible and overreaching" and said it didn't know anything was amiss with Madoff's firm.

"Any suggestion that JPMorgan supported Madoff's fraud is utterly baseless and demonstrably false," the bank said.