OPM

J. Ezra Merkin was sued Monday by New York attorney general, Andrew M. Cuomo. The complaint accused Mr. Merkin of lying to clients about Mr. Madoff’s dominant role in his hedge fund and improperly collecting more than $470 million in fees — fees that dwarfed his own personal losses in the Madoff fraud — for simply handing his clients’ money to Mr. Madoff. The Madoff Ponzi pal has $150 million worth of Mark Rothko paintings—the world's largest private grouping. Mr. Cuomo’s office went a step further, focusing not just on Mr. Merkin’s dealings with Mr. Madoff but also on his broader track record as an investment manager. Specifically, it accused Mr. Merkin of improperly commingling his personal funds with his hedge fund accounts and using some of the money to buy artwork worth more than $91 million for his apartment. The Rothkos, housed in Merkin’s Park Avenue duplex, include two 9-by-15-foot studies for murals that Rothko executed for the Four Seasons restaurant in the Seagram Building and Houston’s Rothko Chapel, and a third, smaller study for a Harvard University mural. The Four Seasons mural paintings are in the National Gallery in Washington. The fate of the Rothko paintings has the art world salivating, as cash-rich collectors are desperate to invest devalued currency into artworks by the dead and aged.