Madoff trustee says he found $1.5B for fraud victims

By BOB VAN VORIS
Bloomberg News

April 10, 2010, 7:25PM

NEW YORK — The trustee liquidating Bernard Madoff's defunct investment-advisory business reported he has recovered $1.5 billion for former customers and is pursuing $14.8 billion more from feeder funds, Madoff's family and friends and related parties.

Irving Picard told a U.S. bankruptcy judge in an 83-page report on Friday that he has made “significant headway into the investigation of Madoff's fraud.” Picard previously said he had recovered $1.08 billion as of June 30.

Picard said in the report, which details his actions through March 31, that he has filed 14 so-called avoidance actions seeking allegedly improper profits from Madoff's $65 billion fraud, the biggest in history. It is the third such report filed by Picard in the case.

“The Trustee anticipates filing extensive additional litigation based on investigation conducted by the trustee's counsel and consultants,” Picard said in the report.

The liquidation is being overseen by the Securities Investor Protection Corp., or SIPC, a government-chartered agency that charges fees to brokerages. As of Feb. 28, SIPC had paid $602.4 million in customer claims and $141.8 million in administrative expenses.

During March, Picard asked for an additional $656.4 million for customer claims and $152.9 million for administrative expenses, he said in Friday's report.

Picard said that he has reviewed 12,249 customer claims, allowing 2,011 of them for a total of $5.3 billion. Claims totaling about $4.6 billion remain that are in excess of SIPC limits, he said.

Madoff, 71, pleaded guilty last year to orchestrating the fraud and was sentenced to 150 years in federal prison.

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