Madoff Victims To Get First Payouts
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Eligible victims of Bernard ‘Bernie’ Madoff’s epic Ponzi scheme will soon be receiving the first checks in their mailboxes, according to the trustee liquidating the Madoff estate in federal bankruptcy court.
Eligible victims of Bernard ‘Bernie’ Madoff’s epic Ponzi scheme will soon be receiving the first checks in their mailboxes, according to the trustee liquidating the Madoff estate in federal bankruptcy court.
Nearly three years after Madoff’s Ponzi scheme was unraveled, his victims are getting their first dips on compensation. About US$312 million in recovered money will be distributed on Wednesday, said Irving Picard, the trustee in charge of liquidating Madoff’s securities firm.
[quote]”This distribution is the first return of stolen funds to Madoff’s defrauded customers. The need among many Madoff customers is urgent and we are working to expedite these distributions,” said Picard.[/quote]Related: Is Madoff A Scapegoat Covering Up For Wall Street?
The distribution would recover about 46% of all losses incurred in 1230 accounts.
The now-defunct Bernard L. Madoff Investment Securities LLC operated as an investment advisory arm that was at the center of a multi-billion dollar, decades long Ponzi scheme: When investors needed to be paid, Madoff recycled payments from money deposited by other investors.
Through out of court settlements by the trustee and civil forfeiture agreements with the Justice Department, US$10.7 billion has been collected to cover what the trustee estimates to be about US$18 billion in out-of-pocket cash losses by eligible victims, a sum that ultimately could allow victims to recover more than half the cash they lost in the Madoff fraud, far more than is typical in Ponzi schemes.
Related: Bernie Madoff’s Wardrobe Will Dress Up Your iPad for US$500
Picard has filed more than 1050 lawsuits and sued for nearly US$100 billion in fictional profits and damages from giant global banks, hedge funds and investment managers who dealt with Madoff during his scheme. If the trustee recovers more than US$18 billion, the money could be used to cover general fraud claims by all Madoff investors.
Madoff, 73, was arrested in December 2008 and pleaded guilty in March 2009 to multiple federal counts of fraud and sentenced to 150 years in prison.
