June 2, 2011

The Madoff effect on divorce

The New York Times had an interesting article about the impact of the Madoff ponzi scheme on divorce cases. The article can be read here:  http://dealbook.nytimes.com/2011/05/30/madoff-victim-seeks-do-over-in-divorce-deal/?emc=eta1

In New York, like in Oregon, the property portion of a divorce ruling/settlement cannot be modified.  In order to set aside a ruling a person has to make a specific showing of fraud and the hurdle is very high.  The article discusses the fact that individuals who had large holdings with Madoff and had to pay an equalizing judgment to their spouse for those funds on divorce are potentially out millions of dollars.  The individual in the article is asking the court to reopen his case saying that the asset held with Madoff was not really an asset at all.