Bernie Madoff's Ponzi Scheme Trustee Makes Fresh $349m Claim for Victims

The trustee appointed to reimburse victims who invested in Bernard L. Madoff Investment Securities, dubbed the largest Ponzi Scheme in history, is seeking another $349m in compensation.

New York lawyer Irving Picard is seeking court approval to pay out a fresh $349m (€252m, £211m) to victims, representing 1,080 accounts.

If approved by a federal bankruptcy judge, total approved payments to former customers of the scheme would increase to about $6bn. That includes the $811.7m in advances committed for distribution to claimants by the Securities Investor Protection Corporation (SIPC), 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 statement.

"Our legal team remains focused on overcoming the remaining challenges that delay additional, even larger, distributions, and bringing more money into the Customer Fund."

The bulk of the payout comes from Picard's $325m settlement of claims against JPMorgan Chase & Co, which had served as Madoff's main bank.

Around-the-Clock Efforts

As of 14 March, Picard had recovered or reached agreements to recover about $9.795bn since his appointment in December 2008. These recoveries exceed similar efforts related to prior Ponzi scheme recoveries, in terms of dollar value and percentage of stolen funds recovered, according to the trustee.

"The progress made by Irving Picard and his team to date is commendable, as around-the-clock efforts continue to maximize the recoveries for customers with missing assets," SIPC President and CEO Stephen Harbeck said.

"The SIPA Trustee and his team, in conjunction with SIPC advances, have returned nearly $6 billion to Madoff's victims. SIPC is pleased to have supported these successful efforts and we look forward to announcing additional, significant milestones and distributions in the not too distant future."

The announcement regarding the latest round of payments comes a day after a federal jury in New York convicted five former Madoff employees of helping their former boss commit fraud.

The jury found that computer programmers, Jerome O'Hara and George Perez, back-office director Daniel Bonventre, and portfolio managers, Annette Bongiorno and Joann Crupi, were found guilty of securities fraud and conspiracy to defraud clients.

They will all be sentenced in July this year.

Madoff masterminded a Ponzi scheme worth $65bn (£40.1bn, €47.5bn) in 2008, but five years later the courts are still being kept busy by a raft of lawsuits.

In 2009, Madoff pleaded guilty and was sentenced to 150 years in prison for controlling the biggest Ponzi fraud yet detected.