Recoveries, Distributions and SIPC Commitment
December 11, 2008 to September 15, 2014

As of September 15, 2014, the Securities Investor Protection Act (SIPA) Trustee has recovered or entered into agreements to recover approximately $9.840 billion, representing more than 56 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.

The fee total on this chart includes fees of the Securities Investor Protection Act (SIPA) Trustee, his counsel at BakerHostetler, his special counsel, and other professionals involved in the unprecedented liquidation of the decades-long Madoff Ponzi fraud. It also includes general administrative costs. These fees and costs are paid by the Securities Investor Protection Corporation (SIPC); no fees or other costs of administration are paid from recoveries obtained by the SIPA Trustee for the benefit of Bernard L. Madoff investment Securities LLC (BLMIS) customers with allowed claims. Fees shown include all fees reported as of March 31, 2014.

Detailed fee applications, which outline the work performed on the global liquidation of BLMIS, are filed at regular intervals with the United States Bankruptcy Court for the Southern District of New York. The fee applications detail services rendered and the status of the liquidation during the reporting period, including settlement agreements, distributions and litigation updates. They also explain the discounts applied to fees, including a 10 percent public interest discount the SIPA Trustee, his counsel and special consultants have adopted since the beginning of the BLMIS liquidation in late 2008. All of the fees to date have been approved by the Bankruptcy Court as customary and in line with competitive fees and expenses.

Bar Graph: Recoveries to Reported Fees Ratio

Distributions and SIPC Commitment Breakdown

DISTRIBUTIONS FROM CUSTOMER FUND

As of September 15, 2014:

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 September 15, 2014, approximately $352.1 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. After the fourth pro rata interim distribution, 1,065 accounts with allowed claims remain partially satisfied and entitled to participate in future interim distributions.

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 September 15, 2014, approximately $523.9 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 September 15, 2014, approximately $3.752 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 September 15, 2014, approximately $517 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 $814.2 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 fourth pro rata interim distribution in the BLMIS liquidation proceeding, SIPC received $114.1 million in reimbursement from the Customer Fund for advances paid on fully satisfied accounts.

Icon: More Information$5.259 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 – available to the court-appointed Securities Investor Protection Act (SIPA) Trustee to distribute to customers with allowed claims, as a way to expedite financial relief to these customers. As of September 15, 2014, SIPC has committed approximately $814.2 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 fourth pro rata interim distribution in the BLMIS liquidation proceeding, SIPC received $114.1 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$700.1 Million