Feds seize Madoff's Florida mansion, stuck with another money loser
Apr 3rd 2009 11:15AM
Updated Dec 4th 2009 1:20PM
United States marshals seized Madoff's mansion in Palm Beach, Florida, and will be stuck with trying to sell it in the miserable Florida real estate market. While Zillow values the property at $17.4 million and the county values it at $9.3 million, a recent appraisal set the price at $7.45 million. On Zillow, homes near it on the waterfront are valued between $19.4 million and $37.5 million. Wonder who's right about the ultimate selling price?
The government wants to seize and sell off whatever family assets it can to repay victims of Bernie Madoff's Ponzi scheme, which prosecutors now believe totals $65 billion. The courts still need to determine how much of the family's fortune will be forfeited. It's safe to guess that an enraged public wants all of it to be taken.
When the prosecutors asked the Federal District Court for a warrant to seize the home, they told the court that the Madoff mansion "should be sold to preserve its value pending a final adjudication of the merits of the government's forfeiture claim." Given the falling real estate prices in Florida, the government made the case that the sooner the better for the sale of the property.
But, now the government is stuck with the costs of maintaining the property, which the New York Times reports costs $3,000 per month for homeowner's insurance, $1,000 per month for utilities and $3,300 for maintenance and security. The annual costs for flood and hurricane insurance exceeded $115,000 because it's a waterfront property in hurricane prone Florida.
According to county tax records, the value of the 8,753 square foot home itself hasn't gone up much between 2006 ($784,691) and 2008 ($787,179). The value of the land on the water though increased about $2.5 million in that same time from $6,020,000 to $8,608,600.
In addition to seizing the home, federal marshals also seized the Madoff's 55-foot yacht called "Bull" docked in Fort Lauderdale Florida, as well as a 24-foot speedboat docked elsewhere in Florida. Another 38-foot yacht docked in Montauk, Long Island called "Sitting Bull" was also seized.
Lita Epstein has written more than 25 books, including Reading Financial Reports for Dummies.