Madoff victims to see another payout

Another US$568 million is making its way back to victims of the massive Ponzi scheme perpetrated by Bernie Madoff.

The U.S. Department of Justice announced that the seventh distribution from the Madoff Victim Fund (MVF), a fund established to return recovered assets to investors, has begun.

This latest distribution will return another US$568 million to approximately 31,000 investors around the world, including 2,600 investors that will see their first recovery in the case.

After these payments are complete, approximately US$3.7 billion will have been returned to nearly 40,000 investors.

It’s expected that the government will ultimately be able to return more than US$4 billion to victims from funds recovered by the DoJ.

These funds are primarily comprised of US$2.2 billion that was forfeited by the estate of deceased Madoff investor, Jeffry Picower; and US$1.7 billion that was collected as part of a deferred prosecution agreement with JPMorgan Chase Bank N.A. The rest was recovered from Madoff and others.

The MVF is overseen by former chairman of the U.S. Securities and Exchange Commission (SEC), Richard Breeden.

According to the DoJ, Madoff used the investment advisory business that he founded in 1960, Bernard L. Madoff Investment Securities LLC (BLMIS), to steal billions from his clients.

In 2009, Madoff pled guilty to 11 charges in connection with the scheme and was sentenced to 150 years in prison. Earlier this year, he died while serving that sentence.

“This office continues to seek justice for victims of history’s largest Ponzi scheme,” said Audrey Strauss, U.S. attorney for the Southern District of New York, in a release. “But our work is not yet finished, and the office’s tireless commitment to compensating the victims who suffered as a result of Madoff’s heinous crimes continues.”

James Langton

James is a senior reporter for Advisor.ca and its sister publication, Investment Executive. He has been reporting on regulation, securities law, industry news and more since 1994.