NEW YORK (Bloomberg) - The trustee appointed to liquidate Bernard L Madoff Investment Securities LLC sued Kingate Management Ltd. for the return of $255 million transferred to the firm's funds in the months before Madoff's collapse

Irving Picard, appointed under the Securities Investor Protection Act, filed a complaint yesterday in US Bankruptcy Court in New York stating that transfers of $100 million to Kingate Global Fund Ltd. and $155 million to Kingate Euro Fund Ltd. from Madoff firm accounts in October and November were improper.

"This complaint seeks the return of the Kingate Global transfers and the Kingate Euro transfers," Mr. Picard's lawyers at Baker & Hostetler LLP said. "Both the Kingate Global transfers and the Kingate Euro transfers are and continue to be customer property."

A call to Kingate's offices in Hamilton, Bermuda, was not immediately returned on Friday. The funds are registered in the British Virgin Islands.

Mr. Picard's complaint also names Bank of Bermuda Ltd., a unit of HSBC Holdings plc., as a defendant. The bank wired the money from Madoff to Kingate, according to court papers. An HSBC spokeswoman did not immediately return a call seeking comment.

Mr. Picard is responsible for conducting a broad investigation of Madoff's assets and actions and has said he has already recovered about $1 billion to repay Madoff clients caught up in the $65 billion Ponzi scheme.

This month, Mr. Picard sued Banque Jacob Safra (Gibraltar) Ltd. and British Virgin Islands-based Vizcaya Partners Ltd. seeking to recover $150 million transferred from Madoff's money- management business last year. That suit was the first one aimed at getting back assets withdrawn by a Madoff client.

Kingate Global invested $963.5 million with Madoff from March 1994 to December 11, while Kingate Euro invested $767.4 million with Madoff beginning in January 1996, through 155 wire transfers to an account at JPMorgan Chase & Co. in New York, according to the complaint.

Bernard Madoff pleaded guilty March 12 to defrauding investors by using money from new ones to pay off old ones in a $65 billion Ponzi scheme. He is in jail and faces as many as 150 years in prison at his sentencing in June.