Madoff bankruptcy trustee files amended suit against sons

Watch Irving Picard, David Sheehan, and Stephen Harbeck discuss 10 years of groundbreaking work.

As of August 16, 2024:

In the SIPA Liquidation of BLMIS, unresolved matters remain that require court determination. Until resolved, these matters require reserves. In addition, 11 claims have been “deemed determined pending litigation” and the SIPA Trustee must establish sufficient reserves to ensure that he would be able to make all pro rata distributions to date to all potentially eligible claimants, whether or not their claims are allowed at the time of distribution.

Required reserve for deemed determined claims: Approximately $748.1 million

General reserve: $0

Other reserves, including reserve for deferred payments and unallocated funds: Approximately $38.7 million

As of August 16, 2024:

Fifteenth interim distribution of 0.419%: $78.6M

Fourteenth pro rata interim distribution of 0.265%: $49.7M

Thirteenth pro rata interim distribution of 0.604%: $113.4M

Twelfth pro rata interim distribution of 1.240%: $233.1M

Eleventh pro rata interim distribution of 1.975%: $372M

Tenth pro rata interim distribution of 2.729%: $515.9M

Ninth pro rata interim distribution of 3.806%: $721.7M

Eighth pro rata interim distribution of 1.729%: $328.8M

Seventh pro rata interim distribution of 1.305%: $248.5M

Sixth pro rata interim distribution of 8.262%: $1.578B

Fifth pro rata interim distribution of 2.743%: $526M

Fourth pro rata interim distribution of 3.180%: $610.4M

Third pro rata interim distribution of 4.721%: $907.3M

Second pro rata interim distribution of 33.556%: $6.478B

First pro rata interim distribution of 4.602%: $891.1M

Amount of SIPC advances reimbursed to SIPC on fully satisfied accounts: $258.1M

In the Bernard L. Madoff Investment Securities LLC (BLMIS) liquidation, the Securities Investor Protection Corporation (SIPC) has made cash advances – up to a maximum of $500,000 per allowed claim – available to the court-appointed Securities Investor Protection Act (SIPA) Trustee to distribute to eligible customers, as a way to expedite financial relief to these customers. As of August 16, 2024, SIPC has committed approximately $850.4 million to the BLMIS liquidation for this purpose. SIPC-committed advances will continue to increase as claims that are currently in litigation are allowed as a result of settlements or the conclusion of litigation.

According to the provisions of SIPA, SIPC is reimbursed for its advances to customers once each respective customer claim is fully satisfied. SIPC has received $258.1 million in reimbursement from the Customer Fund for advances paid on fully satisfied accounts, leaving $592.2 million in SIPC advances outstanding.

*In this instance, the term "subrogation" refers to the reimbursement to SIPC of cash advances made to BLMIS customers, once the respective allowed customer claim has been fully satisfied.

A decade has passed since the discovery of the Madoff Ponzi scheme, the largest financial fraud in history. Understandably, the collapse was met with heartbreak, shock, and disbelief. But just as the realizations of financial loss were taking hold, a professional recovery process was born.

The failure of the Madoff brokerage meant that, simultaneous with the FBI investigations, a special law, the Securities Investor Protection Act, was triggered. This Act gave the Securities Investor Protection Corporation (SIPC) oversight of the case, full responsibility to pay for the recovery effort, and cleared the way for a Trustee, who would have the mandate to search for and use the legal system to recover funds. The Madoff matter became the largest case in the history of SIPC and we were asked to serve as its stewards.

November 30, 2018

The Amazing Madoff Clawback

How two lawyers, Irving Picard and David Sheehan, have recovered 75 cents on the dollar of the stolen money - many times the usual rate in such cases.