Attorneys Joseph Cochett and Nancy Fineman filed the complaint based on an investigation , including a four-hour interview with Madoff in prison in July , that they conducted for former investors . They also allege that major financial institutions , including KPMG , the Bank of New York and JP Morgan Chase , were aware that Madoff was transferring stolen funds to his London office for personal purchases . According to the complaint , Madoff transferred funds to London to buy extravagant personal items . `` In 2006 Madoff thought the end was near because the -LSB- U.S. Securities and Exchange Commission -RSB- investigated . He realized he had to change things up so his focus shifted to London , '' Fineman said . `` We know that KPMG were the auditors for the London branch and that money was used to buy yachts and Bentleys , they are supposed to look at related-party transactions . KPMG should have noticed these as a red flag . '' Officials of KPMG and the Bank of New York did not immediately respond to calls from CNN Wednesday evening for comment on the lawsuit . JP Morgan Chase spokesman Tom Kelly said ,
NEW YORK -LRB- CNN -RRB- -- A new lawsuit alleges that convicted swindler Bernie Madoff financed a cocaine-fueled work environment and a `` culture of sexual deviance , '' and he diverted money to his London , England , office when he believed federal authorities were closing in at home . A new lawsuit alleges Bernie Madoff financed a sex-and-drugs workplace with investors ' money . The lawsuit , filed Tuesday in New York 's State Supreme Court , was brought on behalf of former investors and seeks unspecified punitive damages and compensation . Beyond that , it offers a look at what the plaintiffs ' attorneys say was once Madoff 's multimillion-dollar empire and what is now his world in a federal prison in North Carolina . Among the allegations in the 264-page lawsuit are that during the mid-1970s , Madoff began sending employees to buy drugs for company use . The complaint alleges that some employees and investors were aware of the drug purchases , and that BMIS -LSB- Bernard Madoff Investment Services -RSB- was known by insiders as the `` North Pole '' in reference to the excessive amount of cocaine use in the work place .