Madoff trustee sees victims' payout nearing $6 billion

Tue Mar 25, 2014 5:09pm EDT
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By Jonathan Stempel

NEW YORK (Reuters) - Former customers of Bernard Madoff will have recouped nearly $6 billion of their money if a federal bankruptcy judge approves the latest payout request by the trustee liquidating the swindler's firm.

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 statement.

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.   Continued...

Bernard Madoff walks back to his apartment in New York December 17, 2008. REUTERS/Shannon Stapleton