Madoff settlements reach $12 billion with new accords

[June 28, 2017]  By Jonathan Stempel

NEW YORK (Reuters) - The trustee recouping money for Bernard Madoff's victims on Tuesday announced nearly $371 million of new settlements with two groups of offshore funds that invested with the imprisoned Ponzi schemer, boosting the total recovery to about $12 billion.

Irving Picard, the trustee, said Lagoon Investment Ltd agreed to repay $240.7 million from an account through which Hermes International Fund Ltd invested with Madoff, while Thema Fund Ltd and an affiliate agreed to repay $130.1 million.

Picard announced the settlements with British Virgin Islands-based Lagoon and Bermuda-based Thema one day after revealing more than $23 million of settlements with the estates of Madoff's late sons Andrew and Mark, and entities affiliated with the Madoff family.

Lagoon and Thema were among many feeder funds that sent customers' money, often without their knowledge, to Bernard L. Madoff Investment Securities LLC.

Picard said the recovered sums represent money withdrawn in the six years before Madoff's fraud was uncovered in December 2008.

Like many other former Madoff customers that settled with Picard, Lagoon and Thema will be entitled to share in distributions from the Madoff firm's liquidation.

Picard had previously recovered more than $11.6 billion for Madoff customers who he estimates lost $17.5 billion.

Accused swindler Bernard Madoff exits the Manhattan federal court house in New York, U.S. on January 14, 2009. REUTERS/Brendan McDermid/File Photo

The trustee and Baker & Hostetler have been awarded more than $889 million of compensation for their work on Madoff matters through Nov. 30, 2016, according to an order signed by U.S. Bankruptcy Judge Stuart Bernstein, who oversees the process.

A hearing to consider approving the settlements with Lagoon, Thema and the Madoff sons' estates has been set for July 26.

Andrew Madoff died of cancer in September 2014 and Mark Madoff committed suicide in December 2010. Bernard Madoff, 79, is serving a 150-year prison term.

The case is Securities Investor Protection Corp v. Bernard L. Madoff Investment Securities LLC in the same court, No. 08-01789.

(Reporting by Jonathan Stempel in New York; Editing by Phil Berlowitz)

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