Madoff Ponzi Scheme Victims to Get Everything Back Up to $1 Million

21 Oct 2015 | Author: | No comments yet »

Madoff Trustee Presses Forward With $1.2 Billion Payout Plan.

NEW YORK (AP) — The trustee recovering money lost by investors with imprisoned financier Bernard Madoff reported a new milestone Tuesday, saying a new distribution will mean allowable claims of $1.1 million or less will have been fully reimbursed. Irving Picard, the court-appointed trustee who has been rounding up funds for the victims since shortly after the scam collapsed nearly seven years ago, is asking for permission to return another $1.5 billion to investors, on top of more than $7.6 billion paid out thus far.Another $1.2 billion could soon be repaid to Bernard Madoff’s cheated investors now that the Supreme Court has declined to weigh in on a long-running battle over how to calculate what certain investors are owed.

Anyone who invested up to $1,161,000 with the 77-year-old swindler will “be made completely whole” after the latest round of distribution payments, the head of the group responsible for returning money to hoodwinked investors told ABC News.CHICAGO — The trustee who is recovering money for victims of Bernard Madoff’s Ponzi scheme announced Tuesday another round of distributions of recovered funds will soon begin.

Stephen Harbeck, the CEO of Securities Investors Protection Corporation, said those people who trusted Madoff with more than $1.1 million are expected to recoup 61% of their investment . As part of the Wilpons’ settlement with the trustee, the sides stipulated that the Wilpons lost $178 million in certain Madoff funds, while making $162 million from other funds. So the Wilpon family, businesses and charities right now would owe the trustee $60,561,360 — divided into two installments, and payable in 2016 and 2017.

Picard’s motion is the result of a Supreme Court decision earlier this month not to hear an appeal by some Madoff investors who wanted Picard to adjust the payments for inflation. In a release, the trustee said the distribution will increase the total amount already returned to investors to about $9.1 billion of $17.5 billion in allowable claims.

Bankruptcy Court judge to approve a $1.18 billion distribution to investors.(AP Photo/Stuart Ramson) Authorities said Madoff had sent investors statements telling them that their roughly $20 billion investment had grown to as much as $68 billion when the accounts actually had dwindled to just a few hundred million dollars. Flooded with redemption requests at the height of the financial crisis, Madoff confessed his wildly successful investment advisory business was in fact a massive Ponzi scheme.

Picard, whose fees are paid not by investors but by Wall Street firms through the Securities Investor Protection Corporation (SIPC), announced early on that victims would be entitled only to their “net equity” — the amount they had deposited with Madoff minus any money they had withdrawn. The average payment that an individual investor would receive in the latest payout would be $1.1 million, though the range between the actual payment amounts stretches from under $1,300 for one investor to above $200 million for another. Madoff himself, serving a 150-year sentence at a federal prison in North Carolina, has previously claimed he helped the process, including pressuring the widow of one of his largest investors, Jeffry Picower, to return $7.2 billion in the largest single settlement in the case.

Unless an investor’s claim has already been paid in full, the latest distribution would boost an investor’s recovery in the liquidation to nearly 57%.

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