The trustee, New York lawyer Irving Picard, on Tuesday said he is
seeking approval to pay out $349 million to fraud victims with 1,080
accounts, with payments ranging from $496 to $77.3 million.
The bulk of the payout comes from Picard's $325 million settlement
of claims against JPMorgan Chase & Co, once Madoff's main bank.
Picard said the payout would boost the total amount distributed to
Madoff victims above $5.9 billion, including sums advanced by the
Securities Investor Protection Corp, which oversees the liquidation
of failed brokerages.
"Our commitment is simple: to recover the maximum amount of funds
stolen in the Madoff Ponzi scheme and to distribute these funds to
their rightful owners as quickly as possible," Picard said in a
The proposed payout was announced the day after a federal jury in
New York convicted five former Madoff employees of helping their
former boss commit fraud, including by falsifying customer accounts
and creating false trades and records.
Madoff, 75, is serving a 150-year prison term after pleading guilty
in March 2009 to running a decades-long fraud, which once revealed,
shook public confidence and regulators who failed to detect it.
Four days ago, Picard announced that his law firm, Baker &
Hostetler, submitted a $39.3 million bill for the work of more than
200 lawyers plus other staff between August and November 2013 to
recoup money for victims.
If approved, the amount authorized to be paid to the firm since
Bernard L. Madoff Investment Securities LLC failed in December 2008
would surpass a half-billion dollars, reaching $519.2 million plus
other deferred sums, court records show.
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U.S. Bankruptcy Judge Stuart Bernstein in Manhattan, who now
oversees the liquidation of Madoff's firm following the death in
January of his colleague Burton Lifland, is scheduled to review the
payout and fee requests on April 17.
Picard has recouped $9.8 billion for Madoff's victims, more than
half of his estimate of $17.5 billion in principal lost. Some of the
money has been held back because of litigation challenging Picard's
authority to recoup profits and decisions on who deserves to be
paid. Picard has deemed just 2,517, or 15 percent, of the 16,519
claims he reviewed as "allowed claims."
A separate $4.05 billion fund set up by the U.S. government and
overseen by former U.S. Securities and Exchange Commission Chairman
Richard Breeden will pay customers and third parties who lost money.
(Additional reporting by Sarah N. Lynch in Washington;
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