Recoveries, Distributions and SIPC Commitment
December 11, 2008 to August 12, 2015

As of August 12, 2015, the Securities Investor Protection Act (SIPA) Trustee has recovered or entered into agreements to recover approximately $10.895 billion, representing more than 62 percent of the estimated $17.5 billion in principal lost in the Ponzi scheme by Bernard L. Madoff Investment Securities LLC (BLMIS) customers who filed claims. This recovery far exceeds any prior restitution efforts related to Ponzi schemes both in terms of dollar value and percentage of stolen funds recovered.

One hundred percent of the SIPA Trustee's recoveries will be allocated to the Customer Fund for distribution to BLMIS customers with allowed claims. The costs associated with the SIPA Trustee’s recovery and settlement efforts are paid by the Securities Investor Protection Corporation (SIPC), which administers a fund drawn upon assessments on the securities industry. No fees or other costs of administration are paid from recoveries obtained by the SIPA Trustee for the benefit of BLMIS customers with allowed claims.

Bar Graph: Recoveries to Reported Fees Ratio

Distributions and SIPC Commitment Breakdown

DISTRIBUTIONS FROM CUSTOMER FUND

As of August 12, 2015:

Sixth Pro Rata Interim Distribution

On April 21, 2015, the SIPA Trustee filed a motion in the United States Bankruptcy Court for the Southern District of New York seeking approval for an allocation of recoveries to the BLMIS Customer Fund and an authorization for a sixth pro rata interim distribution from the Customer Fund to BLMIS customers with allowed claims. In the motion, the SIPA Trustee sought the release of $1.249 billion of $1.449 billion that was held in reserve under a September 2012 Bankruptcy Court order, with $904 million available for immediate distribution to customers with allowed claims. The reserve was required due to ongoing litigation of the “time-based damages” issue, in which claimants asserted that they were entitled to an inflation or interest adjustment on their claims. On February 20, 2015, the Second Circuit affirmed that claimants in the SIPA liquidation of BLMIS are not entitled to any interest or inflation adjustments on money deposited at BLMIS. An approval hearing that was originally scheduled for May 28, 2015 was adjourned and then was rescheduled for Wednesday, July 29, 2015.

On July 21, 2015, the SIPA Trustee filed a notice of adjournment of the July 29 hearing. 

The hearing was adjourned because certain BLMIS claimants have filed a petition with the Supreme Court of the United States seeking a writ of certiorari to review the decision by the United States Court of Appeals for the Second Circuit regarding “time-based damages.” 

The hearing for approval of the sixth interim distribution motion will not be rescheduled until such time as the Supreme Court resolves the petition for certiorari and the time-based damages issue reaches a final, unappealable conclusion.

Fifth Pro Rata Interim Distribution

The fifth pro rata interim distribution from the Bernard L. Madoff Investment Securities LLC (BLMIS) Customer Fund to eligible customers commenced on February 6, 2015. As of August 12, 2015, approximately $397.1 million has been distributed to BLMIS account holders with allowed claims in the fifth distribution, representing approximately 2.743 percent of the allowed claim amount of each individual account, unless the claim is fully satisfied.

Fourth Pro Rata Interim Distribution:

The fourth pro rata interim distribution from the Bernard L. Madoff Investment Securities LLC (BLMIS) Customer Fund to eligible customers commenced on May 5, 2014. As of August 12, 2015, approximately $460.9 million has been distributed to BLMIS account holders with allowed claims in the fourth distribution, representing approximately 3.180 percent of the allowed claim amount of each individual account, unless the claim is fully satisfied. 

Third Pro Rata Interim Distribution:

The third pro rata interim distribution from the Bernard L. Madoff Investment Securities LLC (BLMIS) Customer Fund to eligible customers commenced March 29, 2013. As of August 12, 2015, approximately $685.4 million has been distributed to BLMIS accounts with allowed claims in the third distribution, representing approximately 4.721 percent of the allowed claim amount of each individual account, unless the claim is fully satisfied.

Second Pro Rata Interim Distribution:

As of August 12, 2015, approximately $4.900 billion has been returned to BLMIS customers with allowed claims through the second pro rata interim distribution, which represents approximately 33.556 percent of the allowed claim amount of each individual account, unless the claim has been fully satisfied. The second distribution commenced on September 19, 2012.

First Pro Rata Interim Distribution:

As of August 12, 2015, approximately $674.6 million has been returned to BLMIS customers with allowed claims through the first pro rata interim distribution, which represented approximately 4.602 percent of the allowed claim amount of each individual account, unless the claim was fully satisfied. The first distribution commenced on October 5, 2011.

Amount of SIPC advances reimbursed to SIPC on fully satisfied accounts:

The Securities Investor Protection Corporation (SIPC) is authorized to administer funds to customers of failed brokerage firms as an advance against recovered assets. In the BLMIS liquidation proceeding, SIPC has to date advanced approximately $825.7 million to the SIPA Trustee for distribution to BLMIS customers with allowed claims.

According to the provisions of the Securities Investor Protection Act (SIPA), under which SIPC was created, SIPC is reimbursed for advances to customers once each respective customer claim is fully satisfied. As of the fifth pro rata interim distribution in the BLMIS liquidation proceeding, SIPC received $125.3 million in reimbursement from the Customer Fund for advances paid on fully satisfied accounts.

Icon: More Information$7.244 Billion
SIPC COMMITTED FUNDS SUBJECT TO SUBROGATION*

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 12, 2015, SIPC has committed approximately $825.7 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. As of the fifth pro rata interim distribution in the BLMIS liquidation proceeding, SIPC received $125.3 million in reimbursement from the Customer Fund for advances paid on fully satisfied accounts.

*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.

Icon: More Information$700.4 Million

For additional information on the Customer Fund, recoveries, distributions, and fees, please click here.