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December 11, 2018
Press Release: Madoff Recovery Initiative Marks Tenth Anniversary and Files Motion for Tenth Allocation Interim Distribution

Press release from the offices of Irving H. Picard, SIPA Trustee for the liquidation of Bernard L. Madoff Investment Securities LLC (BLMIS), and Stephen P. Harbeck, President and Chief Executive Officer of the Securities Investor Protection Corporation (SIPC)

 MADOFF RECOVERY INITIATIVE MARKS TENTH ANNIVERSARY

MADOFF TRUSTEE FILES MOTION FOR TENTH ALLOCATION AND TENTH INTERIM DISTRIBUTION

  • Madoff Trustee Requests Allocation of More Than $515 Million to Customer Fund and Court Approval to Immediately Distribute More Than $419 Million to BLMIS Customers with Allowed Claims
  • Tenth Interim Distribution Will Bring Aggregate Payout to More Than $12 Billion
  • More Than $13.3 Billion Recovered

NEW YORK, NEW YORK and WASHINGTON, DC – December 11, 2018 – Ten years ago today, the world learned about Bernard Madoff’s unprecedented fraud, a global Ponzi scheme that spanned decades and defrauded thousands of customers.

More than $13.3 billion of those stolen funds have been recovered through the Madoff Recovery Initiative, led by Irving H. Picard, Securities Investor Protection Act (SIPA) Trustee for the liquidation of Bernard L. Madoff Investment Securities LLC (BLMIS), and David J. Sheehan, Chief Counsel to the SIPA Trustee, both of whom are partners at BakerHostetler LLP. The recoveries far exceed similar efforts related to prior Ponzi schemes both in terms of dollar value and percentage of stolen funds recovered. The Initiative is funded by the Securities Investor Protection Corporation (SIPC).

Concurrent with the tenth anniversary of the fraud’s discovery, Mr. Picard filed a motion today in the United States Bankruptcy Court for the Southern District of New York seeking approval for an allocation of more than $515 million in recoveries to the BLMIS Customer Fund and an authorization for a tenth pro rata interim distribution of more than $419 million from the Customer Fund to BLMIS customers with allowed claims. A hearing on the motion has been scheduled for Wednesday, January 23, 2019 at 10:00 a.m. EST.

Stephen P. Harbeck, President and Chief Executive Officer of SIPC, said, “Ten years ago today, Bernard Madoff’s fraud was uncovered. SIPC and the then newly appointed SIPA Trustee, Irving Picard, along with his chief counsel, David Sheehan, launched the Madoff Recovery Initiative, which has since set new benchmarks for similar recovery efforts in the future. It’s appropriate that we announce today yet another benchmark in this remarkable effort: the tenth distribution.”

“At the start of this recovery initiative nearly ten years ago, conventional wisdom said we would only be able to recover pennies on the dollar, given the challenges of reconstructing the fraud, identifying the stolen funds, and recovering those funds,” said Mr. Picard. “However, our teams spread out across the globe, and with unrelenting determination and the support of the Securities Investor Protection Corporation, we have recovered a sum that once seemed out-of-reach and, most importantly, restored stolen funds to their rightful owners.”

Tenth Distribution Will Bring Total Amount Restored to More Than $12 Billion

Plans for the tenth pro rata interim distribution are the result of more than $515 million in settlements and recoveries achieved by the SIPA Trustee and the legal teams since the last interim distribution in February 2018. Among the notable recoveries in 2018 are the $76.5 million payment to the BLMIS Customer Fund by Alpha Prime Fund Ltd. and the $281 million recovery from J. Ezra Merkin, Ascot Partners, L.P., Ascot Fund Limited and Gabriel Capital Corporation.

When combined with the prior nine distributions, the tenth distribution will equal 66.371 percent of each customer’s allowed claim amount, unless that claim has been fully satisfied. The aggregate amount distributed to eligible BLMIS customers will total more than $12 billion, which includes approximately $844.92 million in advances committed by the Securities Investor Protection Corporation (SIPC).

Mr. Picard, Mr. Sheehan, and their teams have delivered more than 900 recovery agreements over the past decade. Thirty-three of these agreements each reflected a recovery of at least $20 million, 16 of which exceeded $100 million each.

“Our teams and Madoff’s claimants have much to celebrate on this tenth anniversary,” said Mr. Sheehan. “However, we are far from done. Even as we look back on this achievement, we are continuing our global efforts and looking ahead to future, significant recoveries and distributions.”

The scope of the crime is without parallel. Ten years ago, with little documentation and less assistance from fraud insiders, the SIPA Trustee and his teams investigated more than 16,500 claims, ultimately allowing more than 2,600. The SIPA Trustee’s efforts to recover stolen funds have involved more than 1,000 lawsuits, including two actions which reached the Supreme Court of the United States. Additionally, the SIPA Trustee’s international investigation and recovery of BLMIS estate assets has spanned more than 45 jurisdictions worldwide.

No funds recovered in the Madoff Recovery Initiative are used to pay costs associated with the recovery. All trustee, legal, and accounting fees, as well as administrative expenses, are paid by SIPC.

“The success of the SIPA Trustee and his teams over the past decade is exceptional, in every aspect,” said Mr. Harbeck. “SIPC has supported the Madoff Recovery Initiative every step of the way, and the recovery is, by any measure, extraordinary.”

The Tenth Customer Fund Allocation and Distribution Motion can be found on the United States Bankruptcy Court’s website at http://www.nysb.uscourts.gov/; Bankr. S.D.N.Y., No. 08-01789 (SMB). It can also be found on the SIPA Trustee’s website along with more information on the BLMIS liquidation at: www.madofftrustee.com.

Messrs. Harbeck, Picard, and Sheehan would like to thank the Securities Investor Protection Corporation’s Josephine Wang, Kevin H. Bell, and Nathanael Kelley; BakerHostetler attorneys Seanna R. Brown, Oren J. Warshavsky, Lan Hoang, Nicholas J. Cremona, Geraldine E. Ponto, Regina L. Griffin, Stacey A. Bell, Thomas L. Long, Keith R. Murphy, Melissa L. Kosack, Geoffrey A. North, Torello H. Calvani, Amy E. Vanderwal, Kathryn M. Zunno, Tatiana Markel, Brian W. Song, Esterina Giuliani, Edward J. Jacobs, Tracy L. Cole, Jorian L. Rose, Gonzalo S. Zeballos, Robertson D. Beckerlegge, Fernando A. Bohorquez, Jason S. Oliver, Jonathan B. New, Catherine E. Woltering, Farrell A. Hochmuth, Deborah H. Renner, James H. Rollinson, Benjamin D. Pergament, Eric R. Fish, Ruth E. Hartman, James A. Sherer, Patrick T. Campbell, Jessie M. Gabriel, Rachel M. Smith, Dean D. Hunt, Marie L. Carlisle, John J. Burke, Steven H. Goldberg, Jimmy Fokas, Michael R. Matthias, Brian A. Bash, Lauren J. Resnick, Carrie Longstaff, Erika K. Thomas, Brian F. Allen, Nkosi D. Shields, Jonathan D. Blattmachr, Jonathan A. Forman, Melissa M. Carvalho, Heather J. McDonald, Andrew W. Reich, Amanda E. Fein, Ganesh Krishna, Stephanie Ackerman, Shawn P. Hough, Stacy A. Dasaro, Heather Wlodek, Noah J. Goertemiller, Ross M. Gillingham, Tara E. Turner, Lindsay J. Biondo, Michelle M. Hoff, Marianne E. Hoover, Samantha A. Cardenas, Joanna F. Wasick, Marshall J. Mattera, Marco Molina, Camille C. Bent, Tara R. Chandler, Maryland H. Ubaid, Melonia A. Bennett, Robyn M. Feldstein, David W. Rice, Maxim G. Brumbach, Lauren E. Martin, Matthew E. Molony, Matthew K. Cowherd, Jena G. Goldmark, David Choi, Michael A. Sabella, Robert G. Nickodem, Francesca Perkins Austin, Peter B. Shapiro, David M. McMillan, Joshua B. Rog, Sophie Rouach, Damon C. Barhorst, Jason I. Blanchard, Frank M. Oliva, Nicholas M. Rose, Jason T. White, Daniel P. Porembski, Joshua L. Berry, Matthew D. Feil, Anat Maytal, Mackenna A. White, Damon M. Durbin, Joel D. Gottesman, Maximillian S. Shifrin, Christopher P. Gallagher, Matthew B. Friedman, Michelle N. Tanney, Andrew M. Serrao, Lauren R. Weinberg, Maria A. de Dios, Victoria L. Stork, Philip Bieler, Andres A. Munoz, Michelle R. Usitalo, Ferve E. Khan, Melissa L. Hansford, Thomas F. Howley, Joyce R. Kennedy, Nickoli X. Miguel, Anthony R. Santiago, Eric B. Hiatt, Lauren T. Attard, Rachel C. Monaghan, Csila Boga-Lofaro, Cara McGourty, Jordan A. Sinclair, Tiffany A. Miao, Kevin M. Wallace, Chloe S. Fischetti, Jean H. Shin, Elyssa S. Kates, Elizabeth G. McCurrach, Lauren M. Hilsheimer, Ian R. Cohen, Stacey M. Patrick, Molly H. Tranbaugh, Lauren P. Berglin, Panida A. Pollawit, Kendall E. Wangsgard, Nichole L. Sterling, and Bari R. Nadworny; Howard L. Simon, Kim M. Longo and their colleagues at Windels Marx Lane & Mittendorf; Vineet Sehgal, Denis O’Connor and their colleagues at AlixPartners; Matt Greenblatt, Lisa Collura and their colleagues at FTI Consulting; and other Special Counsel, who have assisted with the global Madoff Recovery Initiative in the past ten years.


Press Release: Madoff Recovery Initiative Marks Tenth Anniversary and Files Motion for Tenth Allocation Interim Distribution

November 15, 2018
Statement Regarding Twenty-Eighth Fee Application

Statement from the office of Irving H. Picard, SIPA Trustee for the liquidation of Bernard L. Madoff Investment Securities LLC (BLMIS)

Attributable to Heather Wlodek, spokeswoman for Irving H. Picard, SIPA Trustee for the liquidation of Bernard L. Madoff Investment Securities LLC (BLMIS) and his counsel:

On Thursday, November 15, 2018, the SIPA Trustee and his Counsel at BakerHostetler filed their 28th Interim Fee Application with the United States Bankruptcy Court for the Southern District of New York for their work on the global liquidation of BLMIS from April 1, 2018 through July 31, 2018.

• The Application seeks approval of fees, representing approximately 81,526.10 hours of professional and paraprofessional services, which were billed at an average, public interest discounted rate of approximately $417.98 per hour.

• The public interest discount applied represents a reduction of 10 percent from standard rates and it resulted in a total voluntary reduction during the four-month Compensation Period of approximately $3,786,262.68. Additionally, the SIPA Trustee and BakerHostetler voluntarily adjusted their fees by writing off $2,195,885.20 (not including the 10% public interest discount), and wrote off expenses customarily charged to other clients in the amount of $338,818.81.

• The fees requested are reasonable based on the customary compensation charged by comparably skilled practitioners in Chapter 11 matters as well as comparable bankruptcy and non-bankruptcy cases in the competitive national legal market.

• After applying the public interest discount, the total fees requested for the period were $34,076,364.12 (of which $30,668,727.72 is to be paid currently and $3,407,636.40 is to be held back through the conclusion of the liquidation period or until further order by the Court). In addition, $505,031.47 was requested as reimbursement of the actual necessary costs and expenses incurred by the SIPA Trustee and BakerHostetler in connection with the recovery effort.

As noted in the Fee Application:

• During the Compensation Period of April 1, 2018 through July 31, 2018, without the need for protracted litigation, the SIPA Trustee settled 13 cases for $392,531,955.55. The SIPA Trustee entered into settlements subsequent to the Compensation Period that will bring additional funds into the Customer Fund.

• As of the end of the Compensation Period (July 31, 2018), the SIPA Trustee dismissed 277 Hardship Program applicant-defendants from avoidance actions after reviewing the facts and circumstances presented in each application and through additional information requested and verified by the SIPA Trustee.

The SIPA Trustee has recovered or entered into agreements to recover approximately $13.301 billion through October 31, 2018, representing over 75 percent of the estimated $17.5 billion in principal lost in the Ponzi scheme by BLMIS customers who filed claims. This recovery far exceeds any prior restitution effort related to Ponzi schemes both in terms of dollar value and percentage of stolen funds recovered.

The costs associated with the SIPA Trustee’s recovery and settlement efforts are paid by 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. 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 SIPA Trustee has distributed more than $11.915 billion to BLMIS customers with allowed claims through October 31, 2018, which includes a total of $11.070 billion in distributions from the Customer Fund and $844.918 million in funds committed to be advanced by SIPC.

The first pro rata interim distribution commenced on October 5, 2011 and to date equals approximately $803 million. A second pro rata interim distribution commenced on September 19, 2012 and to date equals approximately $5.8 billion. The third pro rata interim distribution commenced on March 29, 2013 and to date equals approximately $817 million. The fourth pro rata interim distribution commenced on May 5, 2014, and the SIPA Trustee has distributed approximately $550 million. In the fifth pro rata interim distribution, which commenced on February 6, 2015, he has distributed approximately $474 million. In the sixth pro rata interim distribution, which commenced on December 4, 2015, the SIPA Trustee distributed approximately $1.4 billion. The seventh pro rata interim distribution commenced on June 30, 2016 and to date equals approximately $224 million. The eighth pro rata interim distribution commenced on February 2, 2017 and to date equals approximately $296 million. The ninth pro rata interim distribution commenced on February 22, 2018, and the SIPA Trustee has distributed approximately $649 million.

In addition, SIPC has made advances available to the court-appointed SIPA Trustee to distribute to accounts with allowed claims (up to $500,000 maximum), as a way to expedite financial relief to those account holders. To date, SIPC has committed $844.918 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. Under SIPA, SIPC must be reimbursed for its advances to customers. To date, SIPC has received approximately $205 million in reimbursement.

The Bankruptcy Court hearing for approval of the 28th Fee Application has been scheduled for December 19, 2018 at 10 a.m.
The BakerHostetler attorneys who worked on behalf of the SIPA Trustee filing this Fee Application include David J. Sheehan, Seanna R. Brown and Heather R. Wlodek.

The filing is available on the Bankruptcy Court’s website: www.nysb.uscourts.gov; Case No. 08-01789. The Fee Application as well as additional information on recoveries, settlements and court filings can be found on the SIPA Trustee’s website: www.madofftrustee.com.

Statement Regarding Twenty-Eighth Fee Application

July 13, 2018
Statement Regarding Twenty-Seventh Fee Application

Statement from the office of Irving H. Picard, SIPA Trustee for the liquidation of Bernard L. Madoff Investment Securities LLC (BLMIS)

Attributable to Heather Wlodek, spokeswoman for Irving H. Picard, SIPA Trustee for the liquidation of Bernard L. Madoff Investment Securities LLC (BLMIS) and his counsel:

On Friday, July 13, 2018, the SIPA Trustee and his Counsel at BakerHostetler filed their 27th Interim Fee Application with the United States Bankruptcy Court for the Southern District of New York for their work on the global liquidation of BLMIS from December 1, 2017 through March 31, 2018.

• The Application seeks approval of fees, representing approximately 78,513.90 hours of professional and paraprofessional services, which were billed at an average, public interest discounted rate of approximately $426.77 per hour.

• The public interest discount applied represents a reduction of 10 percent from standard rates and it resulted in a total voluntary reduction during the four-month Compensation Period of approximately $3,723,054.00. Additionally, the SIPA Trustee and BakerHostetler voluntarily adjusted their fees by writing off $2,007,879.80 (not including the 10% public interest discount), and wrote off expenses customarily charged to other clients in the amount of $313,729.00.

• The fees requested are reasonable based on the customary compensation charged by comparably skilled practitioners in Chapter 11 matters as well as comparable bankruptcy and non-bankruptcy cases in the competitive national legal market.

• After applying the public interest discount, the total fees requested for the period were $33,507,486.00 (of which $30,156,737.40 is to be paid currently and $3,350,748.60 is to be held back through the conclusion of the liquidation period or until further order by the Court). In addition, $400,202.04 was requested as reimbursement of the actual necessary costs and expenses incurred by the SIPA Trustee and BakerHostetler in connection with the recovery effort.

As noted in the Fee Application:

• During the Compensation Period of December 1, 2017 through March 31, 2018, without the need for protracted litigation, the SIPA Trustee settled 23 cases for $52,051,830.20. The SIPA Trustee entered into settlements subsequent to the Compensation Period that will bring additional funds into the Customer Fund.

• As of the end of the Compensation Period (March 31, 2018), the SIPA Trustee dismissed 277 Hardship Program applicant-defendants from avoidance actions after reviewing the facts and circumstances presented in each application and through additional information requested and verified by the SIPA Trustee.

The SIPA Trustee has recovered or entered into agreements to recover approximately $13.263 billion through July 10, 2018, representing over 75 percent of the estimated $17.5 billion in principal lost in the Ponzi scheme by BLMIS customers who filed claims. This recovery far exceeds any prior restitution effort related to Ponzi schemes both in terms of dollar value and percentage of stolen funds recovered.

The costs associated with the SIPA Trustee’s recovery and settlement efforts are paid by 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. 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 SIPA Trustee has distributed more than $11.594 billion to BLMIS customers with allowed claims through July 10, 2018, which includes a total of $10.749 billion in distributions from the Customer Fund and $844.918 million in funds committed to be advanced by SIPC.

The first pro rata interim distribution commenced on October 5, 2011 and to date equals approximately $780 million. A second pro rata interim distribution commenced on September 19, 2012 and to date equals approximately $5.7 billion. The third pro rata interim distribution commenced on March 29, 2013 and to date equals approximately $793.5 million. The fourth pro rata interim distribution commenced on May 5, 2014, and the SIPA Trustee has distributed approximately $533.7 million. In the fifth pro rata interim distribution, which commenced on February 6, 2015, he has distributed approximately $459.9 million. In the sixth pro rata interim distribution, which commenced on December 4, 2015, the SIPA Trustee distributed approximately $1.4 billion. The seventh pro rata interim distribution commenced on June 30, 2016 and to date equals approximately $217.1 million. The eighth pro rata interim distribution commenced on February 2, 2017 and to date equals approximately $287.1 million. The ninth pro rata interim distribution commenced on February 22, 2018, and the SIPA Trustee has distributed approximately $629.9 million.

In addition, SIPC has made advances available to the court-appointed SIPA Trustee to distribute to accounts with allowed claims (up to $500,000 maximum), as a way to expedite financial relief to those account holders. To date, SIPC has committed $844.918 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. Under SIPA, SIPC must be reimbursed for its advances to customers. To date, SIPC has received approximately $205 million in reimbursement.

The Bankruptcy Court hearing for approval of the 27th Fee Application has been scheduled for August 29, 2018 at 10 a.m.
The BakerHostetler attorneys who worked on behalf of the SIPA Trustee filing this Fee Application include David J. Sheehan, Seanna R. Brown and Heather R. Wlodek.

The filing is available on the Bankruptcy Court’s website: www.nysb.uscourts.gov; Case No. 08-01789. The Fee Application as well as additional information on recoveries, settlements and court filings can be found on the SIPA Trustee’s website: www.madofftrustee.com.

Statement Regarding Twenty-Seventh Fee Application

July 05, 2018
Madoff Recovery Initiative Reaches Approximately $13.26 Billion in Recovered Funds

Press release from the offices of Irving H. Picard, SIPA Trustee for the liquidation of Bernard L. Madoff Investment Securities LLC (BLMIS), and Stephen P. Harbeck, President and Chief Executive Officer of the Securities Investor Protection Corporation (SIPC)


MADOFF RECOVERY INITIATIVE REACHES APPROXIMATELY $13.26 BILLION IN RECOVERED FUNDS

AGGREGATE DISTRIBUTIONS TOTAL APPROXIMATELY
$11.9 BILLION

 

NEW YORK, NEW YORK and WASHINGTON, DC – July 5, 2018 – Irving H. Picard, Securities Investor Protection Act (SIPA) Trustee for the liquidation of Bernard L. Madoff Investment Securities LLC (BLMIS), said that with Tuesday’s Court approval of the SIPA Trustee’s motion to approve the settlement with Ascot Partners, L.P., Ascot Fund Limited, J. Ezra Merkin, and Gabriel Capital Corporation, the Madoff Recovery Initiative has now reached more than $13.26 billion in recoveries, a new milestone for recoveries in Ponzi schemes. The recoveries exceed similar efforts related to prior Ponzi schemes both in terms of dollar value and percentage of stolen funds recovered.

“At the start of this recovery initiative nearly ten years ago, we were determined to recover as much as possible for Madoff’s victims, but we were not sure how much we could recover,” said Mr. Picard. “Thanks to the wonderful performance of our teams and the backing of SIPC, we have achieved unprecedented success – recovery of over $13.26 billion -- for those whose funds were stolen by Madoff. It’s an exceptional outcome for Madoff’s victims, many of whom didn’t expect to get any of their stolen funds returned.”

“The SIPA Trustee and his teams are a shining example of a successful SIPC recovery effort,” said Stephen P. Harbeck, SIPC’s President and Chief Executive Officer. “SIPC was established to assist the victims of thefts like Madoff’s. We have a long history of success, and the outstanding result of the Madoff Recovery Initiative is an extraordinary example.”

“Surpassing the $13.26 billion mark is great news for all of Madoff’s victims, both the ‘direct’ and ‘indirect’ investors with BLMIS,” said David J. Sheehan, Chief Counsel to the SIPA Trustee. “But our work is not done. We continue to pursue many avenues on behalf of Madoff’s victims, and look forward to returning even more in stolen funds back to Madoff’s victims as we pass additional, significant milestones in the future.”

As of today, and since his appointment in December 2008, the SIPA Trustee has recovered $13.26 billion for Madoff victims, every penny of which is placed into the BLMIS Customer Fund for distributions to Madoff victims. The $13.26 billion represents approximately 75% of the estimated $17.5 billion in principal lost in the Ponzi scheme by BLMIS customers who filed claims.

Distributions from the Customer Fund are made to BLMIS customers with allowed claims. The SIPA Trustee has also structured agreements with Madoff feeder funds that insure “indirect” BLMIS customers receive distributions from the Customer Fund.

No funds recovered in the Madoff Recovery Initiative are used to pay administrative costs. All trustee, legal and accounting fees, as well as administrative expenses, are paid by SIPC.

The SIPA Trustee has completed nine interim pro rata distributions to BLMIS account holders with allowed claims, bringing the aggregate amount distributed to eligible claimants to more than $11.91 billion, which includes approximately $844.92 million in funds committed to be advanced by SIPC, and which represents 63.904 percent of each allowed claim amount.

The SIPA Trustee’s motion and the Court’s order can be found on the United States Bankruptcy Court’s website at http://www.nysb.uscourts.gov/; Bankr. S.D.N.Y., No. 08-01789 (SMB) / Adv. Pro. No. 09-01364 (SMB). The motion and the Court’s order – as well as further information on recoveries to date, other legal proceedings, further settlements, and general information – can also be found on the SIPA Trustee’s website: www.madofftrustee.com.

Messrs. Harbeck, Picard, and Sheehan would like to thank the Securities Investor Protection Corporation’s Josephine Wang, Kevin H. Bell, and Nathanael Kelley, as well as BakerHostetler attorneys Seanna R. Brown, Oren J. Warshavsky, Lan Hoang, Nicholas J. Cremona, Geraldine E. Ponto, Regina L. Griffin, Stacey A. Bell, Thomas L. Long, Keith R. Murphy, Melissa L. Kosack, Geoffrey A. North, Torello H. Calvani, Amy E. Vanderwal, Kathryn M. Zunno, Tatiana Markel, Brian W. Song, Esterina Giuliani, Edward J. Jacobs, Tracy L. Cole, Jorian L. Rose, Gonzalo S. Zeballos, Robertson D. Beckerlegge, Fernando A. Bohorquez, Jason S. Oliver, Jonathan B. New, Catherine E. Woltering, Farrell A. Hochmuth, Deborah H. Renner, James H. Rollinson, Benjamin D. Pergament, Eric R. Fish, Ruth E. Hartman, James A. Sherer, Patrick T. Campbell, Jessie M. Gabriel, Rachel M. Smith, Dean D. Hunt, Marie L. Carlisle, John J. Burke, Steven H. Goldberg, Jimmy Fokas, Michael R. Matthias, Brian A. Bash, Lauren J. Resnick, Carrie Longstaff, Erika K. Thomas, Brian F. Allen, Nkosi D. Shields, Jonathan D. Blattmachr, Jonathan A. Forman, Melissa M. Carvalho, Heather J. McDonald, Andrew W. Reich, Amanda E. Fein, Ganesh Krishna, Stephanie Ackerman, Shawn P. Hough, Stacy A. Dasaro, Noah J. Goertemiller, Ross M. Gillingham, Tara E. Turner, Lindsay J. Biondo, Michelle M. Hoff, Marianne E. Hoover, Samantha A. Cardenas, Joanna F. Wasick, Marshall J. Mattera, Marco Molina, Camille C. Bent, Tara R. Chandler, Maryland H. Ubaid, Melonia A. Bennett, Robyn M. Feldstein, David W. Rice, Maxim G. Brumbach, Lauren E. Martin, Matthew E. Molony, Matthew K. Cowherd, Jena G. Goldmark, David Choi, Michael A. Sabella, Robert G. Nickodem, Francesca Perkins Austin, Peter B. Shapiro, S. Benjamin Barnes, David M. McMillan, Joshua B. Rog, Sophie Rouach, Damon C. Barhorst, Jason I. Blanchard, Frank M. Oliva, Nicholas M. Rose, Jason T. White, Daniel P. Porembski, Joshua L. Berry, Kenneth A. Foisy, Heather Wlodek, Matthew D. Feil, Anat Maytal, Mackenna A. White, Damon M. Durbin, Joel D. Gottesman, Maximillian S. Shifrin, Christopher P. Gallagher, Matthew B. Friedman, Michelle N. Tanney, Andrew M. Serrao, Lauren R. Weinberg, Maria A. de Dios, Victoria L. Stork, Philip Bieler, Andres A. Munoz, Michelle R. Usitalo, Ferve E. Khan, Melissa L. Hansford, Jody E. Schechter, Thomas F. Howley, Joyce R. Kennedy, Nickoli X. Miguel, Margaret A. Nowak, Anthony R. Santiago, Eric B. Hiatt, Lauren T. Attard, Rachel C. Monaghan, Csila Boga-Lofaro, Cara McGourty, Jordan A. Sinclair, Tiffany A. Miao, Kevin M. Wallace, Chloe S. Fischetti, Jean H. Shin, Elyssa S. Kates, Elizabeth G. McCurrach, Lauren M. Hilsheimer, Ian R. Cohen, Stacey M. Patrick, Molly H. Tranbaugh, Lauren P. Berglin, Panida A. Pollawit, Kendall E. Wangsgard, Nichole L. Sterling, and Bari R. Nadworny, who have assisted with the global Madoff Recovery Initiative in the past ten years.

Madoff Recovery Initiative Reaches Approximately $13.26 Billion in Recovered Funds

June 13, 2018
Press Release: Madoff Trustee Reaches Recovery Agreement with Ascot Partners, Ascot Fund, J. Ezra Merkin, and Gabriel Capital Corporation

Press release from the offices of Irving H. Picard, SIPA Trustee for the liquidation of Bernard L. Madoff Investment Securities LLC (BLMIS), and Stephen P. Harbeck, President and Chief Executive Officer of the Securities Investor Protection Corporation (SIPC)


MADOFF TRUSTEE REACHES RECOVERY AGREEMENT
WITH ASCOT PARTNERS, ASCOT FUND, J. EZRA MERKIN, AND GABRIEL CAPITAL CORPORATION

SETTLEMENT DELIVERS IMMEDIATE BENEFIT TO BLMIS CUSTOMER FUND OF $280 MILLION

DOMESTIC AND FOREIGN MADOFF “INDIRECT” INVESTORS TO RECEIVE BENEFITS FROM MADOFF TRUSTEE’S DISTRIBUTIONS TO ASCOT PARTNERS

NEW YORK, NEW YORK and WASHINGTON, DC – June 13, 2018 – Irving H. Picard, Securities Investor Protection Act (SIPA) Trustee for the liquidation of Bernard L. Madoff Investment Securities LLC (BLMIS), filed a motion today in the United States Bankruptcy Court for the Southern District of New York, seeking approval of a recovery agreement with Ascot Partners, L.P. (“Ascot Partners”), Ascot Fund Limited (“Ascot Fund”), J. Ezra Merkin (“Merkin”), and Gabriel Capital Corporation (“GCC”). An approval hearing for the agreement has been set for July 10, 2018 at 2 p.m.

Ascot Partners was a BLMIS feeder fund run by J. Ezra Merkin and his management company, GCC. Through this settlement, the SIPA Trustee will recover $280 million for the BLMIS Customer Fund, representing 100 percent of the transfers Ascot Partners received from BLMIS in the two years preceding the commencement of BLMIS’s SIPA proceeding.

The SIPA Trustee will allow the net equity claim of Ascot Partners upon receipt of the $280 million payment. Ascot Partners will receive a pro rata share of the catch-up distribution that will be paid to investors of Ascot Partners.

The settlement with the Ascot Partners feeder fund is structured to ensure that all the benefits go to its investors – individuals or entities that were not “direct” clients of Madoff but invested “indirectly” with BLMIS through Ascot Partners. All distributions made by the SIPA Trustee to Ascot Partners will be paid to the investors of Ascot Partners, except that no payments shall be made to Merkin, his family, GCC, or any other person, entity, or trust controlled by or for the benefit of Merkin or his family.

“This agreement embodies two goals of the SIPA Trustee: It first provides an immediate, substantial benefit to the BLMIS customer estate through the recovery of $280,000,000. And second, it provides a significant distribution to Ascot Partners and the right to fully participate in future distributions, which benefits the indirect investors,” said BakerHostetler partner Lan Hoang.

“Once again, the SIPA Trustee and his team have crafted an agreement that benefits Madoff’s real victims and expedites compensation to indirect investors in BLMIS,” said Stephen P. Harbeck, President and Chief Executive Officer of the Securities Investor Protection Corporation. “The agreement is another significant win for all victims of Bernard Madoff’s Ponzi scheme, but in particular, the indirect investors in Madoff feeder funds. All funds collected go directly to victims. SIPC pays all expenses related to the Madoff Recovery Initiative.”

The SIPA Trustee has recovered approximately $12.98 billion to date, representing approximately 74 percent of the estimated $17.5 billion in principal lost in the Ponzi scheme by BLMIS customers who filed claims. The SIPA Trustee has distributed approximately $11.59 billion to BLMIS customers with allowed claims, which includes a total of $10.75 billion in distributions from the Customer Fund and approximately $844.92 million in funds committed to be advanced by SIPC.

The SIPA Trustee’s motion can be found on the United States Bankruptcy Court’s website at http://www.nysb.uscourts.gov/; Bankr. S.D.N.Y., No. 08-01789 (SMB) / Adv. Pro. No. 09-01364 (SMB). The motion – as well as further information on recoveries to date, other legal proceedings, further settlements, and general information – can also be found on the SIPA Trustee’s website: www.madofftrustee.com.

Messrs. Harbeck and Picard, and David J. Sheehan, Chief Counsel to the SIPA Trustee, would like to thank the Securities Investor Protection Corporation’s Josephine Wang, Kevin H. Bell and Nathanael Kelley, as well as BakerHostetler attorneys Lan Hoang, Brian W. Song, Seanna R. Brown, Carrie Longstaff, Ganesh Krishna, Robyn Feldstein, Joshua B. Rog, Stephanie Ackerman and Bari Nadworny, who assisted with the work on this matter and settlement.

Press Release: Madoff Trustee Reaches Recovery Agreement with Ascot Partners, Ascot Fund, J. Ezra Merkin, and Gabriel Capital Corporation

March 15, 2018
Statement Regarding Twenty-Sixth Fee Application

Statement from the office of Irving H. Picard, SIPA Trustee for the liquidation of Bernard L. Madoff Investment Securities LLC (BLMIS)

Attributable to Heather Wlodek, spokeswoman for Irving H. Picard, SIPA Trustee for the liquidation of Bernard L. Madoff Investment Securities LLC (BLMIS) and his counsel:

On Thursday, March 15, 2018, the SIPA Trustee and his Counsel at BakerHostetler filed their 26th Interim Fee Application with the United States Bankruptcy Court for the Southern District of New York for their work on the global liquidation of BLMIS from August 1, 2017 through November 30, 2017.

• The Application seeks approval of fees, representing approximately 80,558.80 hours of professional and paraprofessional services, which were billed at an average, public interest discounted rate of approximately $423.68 per hour.

• The public interest discount applied represents a reduction of 10 percent from standard rates and it resulted in a total voluntary reduction during the four-month Compensation Period of approximately $3,792,391.56. Additionally, the SIPA Trustee and BakerHostetler voluntarily adjusted their fees by writing off $2,015,879.60 (not including the 10% public interest discount), and wrote off expenses customarily charged to other clients in the amount of $306,170.69.

• The fees requested are reasonable based on the customary compensation charged by comparably skilled practitioners in Chapter 11 matters as well as comparable bankruptcy and non-bankruptcy cases in the competitive national legal market.

• After applying the public interest discount, the total fees requested for the period were $34,131,524.04 (of which $30,718,371.64 is to be paid currently and $3,413,152.40 is to be held back through the conclusion of the liquidation period or until further order by the Court), representing an average of approximately 20,139.70 hours worked per month on the international and domestic investigations, negotiations and litigation resulting from the largest financial fraud of its kind in U.S. history. In addition, $290,520.17 was requested as reimbursement of the actual necessary costs and expenses incurred by the SIPA Trustee and BakerHostetler in connection with the recovery effort.

As noted in the Fee Application:

• During the Compensation Period of August 1, 2017 through November 30, 2017, without the need for protracted litigation, the SIPA Trustee settled 38 cases for $797,072,849.02. The SIPA Trustee entered into settlements subsequent to the Compensation Period that will bring additional funds into the Customer Fund.

• As of the end of the Compensation Period (November 30, 2017), the SIPA Trustee dismissed 280 Hardship Program applicant-defendants from avoidance actions after reviewing the facts and circumstances presented in each application and through additional information requested and verified by the SIPA Trustee.

As of January 31, 2018, the SIPA Trustee has recovered or entered into agreements to recover approximately $12.846 billion, representing over 73 percent of the estimated $17.5 billion in principal lost in the Ponzi scheme by BLMIS customers who filed claims. This recovery far exceeds any prior restitution effort related to Ponzi schemes both in terms of dollar value and percentage of stolen funds recovered.

The costs associated with the SIPA Trustee’s recovery and settlement efforts are paid by 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. 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 SIPA Trustee has distributed approximately $11.441 billion to BLMIS customers with allowed claims through February 22, 2018, which includes a total of $10.597 billion in distributions from the Customer Fund and $844.313 million in funds committed to be advanced by SIPC.

The first pro rata interim distribution commenced on October 5, 2011 and to date equals approximately $769.1 million. A second pro rata interim distribution commenced on September 19, 2012 and to date equals approximately $5.6 billion. The third pro rata interim distribution commenced on March 29, 2013 and to date equals approximately $782.2 million. The fourth pro rata interim distribution commenced on May 5, 2014, and the SIPA Trustee has distributed approximately $526.1 million. In the fifth pro rata interim distribution, which commenced on February 6, 2015, he has distributed approximately $453.3 million. In the sixth pro rata interim distribution, which commenced on December 4, 2015, the SIPA Trustee distributed approximately $1.4 billion. The seventh pro rata interim distribution commenced on June 30, 2016 and to date equals approximately $214.0 million. The eighth pro rata interim distribution commenced on February 2, 2017 and to date equals approximately $283.0 million. The ninth pro rata interim distribution commenced on February 22, 2018, and the SIPA Trustee has distributed approximately $620.9 million.

In addition, SIPC has made advances available to the court-appointed SIPA Trustee to distribute to accounts with allowed claims (up to $500,000 maximum), as a way to expedite financial relief to those account holders. To date, SIPC has committed $844.313 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. Under SIPA, SIPC must be reimbursed for its advances to customers. To date, SIPC has received approximately $205 million in reimbursement.

The Bankruptcy Court hearing for approval of the 26th Fee Application has been scheduled for April 25, 2018 at 10 a.m.

The BakerHostetler attorneys who worked on behalf of the SIPA Trustee filing this Fee Application include David J. Sheehan, Seanna R. Brown and Heather R. Wlodek.

The filing is available on the Bankruptcy Court’s website: www.nysb.uscourts.gov; Case No. 08-01789. The Fee Application as well as additional information on recoveries, settlements and court filings can be found on the SIPA Trustee’s website: www.madofftrustee.com.

Statement Regarding Twenty-Sixth Fee Application

February 22, 2018
Press Release: Ninth Pro Rata Interim Distribution of Recovered Funds to Madoff Claims Holders Commences; Totals Approximately $620.9 Million

NINTH PRO RATA INTERIM DISTRIBUTION OF RECOVERED FUNDS
TO MADOFF CLAIMS HOLDERS COMMENCES;
TOTALS APPROXIMATELY $620.9 MILLION

Aggregate Distributions Total More Than $11.4 Billion

NEW YORK, NEW YORK and WASHINGTON, DC – February 22, 2018 – Irving H. Picard, Securities Investor Protection Act (SIPA) Trustee for the liquidation of Bernard L. Madoff Investment Securities LLC (BLMIS), announced that the ninth pro rata interim distribution from the Customer Fund to eligible BLMIS customers commenced today.

The SIPA Trustee is distributing approximately $620.9 million on a pro rata basis to BLMIS account holders with allowed claims, bringing the aggregate amount distributed to eligible claimants to more than $11.4 billion, which includes more than $844.3 million in committed advances from the Securities Investor Protection Corporation (SIPC). The ninth pro rata interim distribution, when combined with the prior eight distributions, represents 63.904 percent of each allowed claim amount – unless that claim has been fully satisfied – and will be paid to record holders of allowed claims as of January 31, 2018.

“Each distribution is another significant victory as we work to unwind and bring relief for the harm done in the Madoff Ponzi scheme,” said SIPC President and CEO Stephen P. Harbeck. “All of the funds recovered by the SIPA Trustee go to the victims of the Madoff fraud. And with the continued success of the Trustee and his legal team, we are hopeful there will be further distributions in 2018. It is important to note that every single penny recovered by the Madoff Recovery Initiative goes to satisfy allowed customer claims. SIPC picks up all the costs of the Madoff Recovery Initiative as the Securities Investor Protection Act directs.”

The ninth pro rata interim distribution was reached as a result of settlements and recoveries achieved by the SIPA Trustee, his Chief Counsel David J. Sheehan, and their legal teams since the last interim distribution in February 2017. The most notable was the recovery agreement of approximately $687 million with the Thema International Fund as well as the approximately $370 million recovery agreements with the Lagoon and Thema Funds.

As of January 31, 2018 and since his appointment in December 2008, the SIPA Trustee has received $12.846 billion as a result of recoveries and agreements to recover. These recoveries exceed similar efforts related to prior Ponzi scheme recoveries, in terms of dollar value and percentage of stolen funds recovered.

Ultimately, 100 percent of the SIPA Trustee’s recoveries will be allocated to the Customer Fund for distribution to BLMIS customers – both direct and indirect – with allowed claims. None of the money recovered is used to pay administrative costs. All trustee, legal and accounting fees, as well as administrative expenses, are paid by SIPC.

More information on overall recoveries to date and the ongoing liquidation can be found on the SIPA Trustee’s website: www.madofftrustee.com.

Messrs. Harbeck, Picard and Sheehan would like to thank BakerHostetler attorneys Oren Warshavsky, Seanna Brown and Heather Wlodek, who worked on the ninth pro rata interim distribution and its related filings, as well as BakerHostetler, Windels Marx and all of the attorneys and professionals whose work has led to the distribution. They would also like to thank Vineet Sehgal and his colleagues at AlixPartners, as well as Josephine Wang, Kevin Bell, Nathanael Kelley, and their colleagues at SIPC, for their ongoing work and participation in the Madoff Recovery Initiative distributions.

 

 

Press Release: Ninth Pro Rata Interim Distribution of Recovered Funds to Madoff Claims Holders Commences; Totals Approximately $620.9 Million

February 12, 2018
Press Release: Madoff Trustee Reaches Recovery Agreement with Alpha Prime Fund for $76 Million

MADOFF TRUSTEE REACHES RECOVERY AGREEMENT
WITH ALPHA PRIME FUND FOR $76 MILLION

Madoff Trustee Has Recovered or Reached Agreements to Recover More Than $12.8 Billion To Date in BLMIS Liquidation


More Than $10 Billion Distributed to Madoff Victims To Date


NEW YORK, NEW YORK and WASHINGTON, DC – February 12, 2018 – Irving H. Picard, Securities Investor Protection Act (SIPA) Trustee for the liquidation of Bernard L. Madoff Investment Securities LLC (BLMIS), filed a motion today in the United States Bankruptcy Court for the Southern District of New York, seeking approval of a settlement agreement with Alpha Prime Fund Ltd. (“Alpha Prime”). An approval hearing for the agreement has been set for March 28, 2018 at 10 a.m.

Alpha Prime was a BLMIS feeder fund incorporated under Bermuda law. Through this settlement, the SIPA Trustee will recover $76.45 million, representing 100 percent of the transfers Alpha Prime received from BLMIS in the two years preceding the commencement of BLMIS’s SIPA proceeding. This agreement leaves open issues concerning Alpha Prime’s ability to collect certain monies from the BLMIS Customer Fund.

“This agreement confers a significant, immediate benefit to the BLMIS Customer Fund,” said BakerHostetler partner Oren J. Warshavsky. “Our commitment to the BLMIS Customer Fund is evident with this unique settlement. This could be a game changer for how trustees approach complicated resolutions going forward.”

“Once again, the SIPA Trustee and his team have reached a favorable outcome for the customers of BLMIS,” said Stephen P. Harbeck, President and Chief Executive Officer of SIPC. “This is an important addition to the Customer Fund and the recoveries will be distributed as quickly as possible.”

The SIPA Trustee’s motion can be found on the United States Bankruptcy Court’s website at http://www.nysb.uscourts.gov/; Bankr. S.D.N.Y., No. 08-01789 (SMB) / Adv. Pro. No. 09-01364 (SMB). The motion – as well as further information on recoveries to date, other legal proceedings, further settlements, and general information – can also be found on the SIPA Trustee’s website: www.madofftrustee.com.

Messrs. Harbeck and Picard, and David J. Sheehan, Chief Counsel to the SIPA Trustee, would like to thank the Securities Investor Protection Corporation’s Josephine Wang and Kevin Bell, as well as BakerHostetler attorneys Oren J. Warshavsky, Geoffrey A. North, Gonzalo S. Zeballos, Tatiana Markel, and Carrie A. Longstaff, who assisted with the work on the matter and the settlement.

Press Release: Madoff Trustee Reaches Recovery Agreement with Alpha Prime Fund for $76 Million

January 30, 2018
Statement Regarding Bankruptcy Court Approval of Ninth Interim Pro Rata Distribution

Statement from the office of Irving H. Picard, SIPA Trustee for the liquidation of Bernard L. Madoff Investment Securities LLC (BLMIS)

Attributable to Heather Wlodek, spokeswoman for Irving H. Picard, SIPA Trustee for the liquidation of Bernard L. Madoff Investment Securities LLC (BLMIS) and his counsel:

The United States Bankruptcy Court for the Southern District of New York today approved the SIPA Trustee’s request for an allocation of approximately $1.3 billion in recoveries to the BLMIS Customer Fund and has authorized the SIPA Trustee to proceed with the ninth pro rata interim distribution from the Customer Fund to BLMIS customers with allowed claims.

As announced on December 18, 2017, with today’s court approval, the SIPA Trustee will allocate approximately $1.3 billion to the BLMIS Customer Fund, with approximately $584.5 million available for immediate distribution to customers with allowed claims. The remaining allocation will be held in reserve for claims that are deemed determined pending the resolution of litigation as well as other issues.

This ninth pro rata interim distribution, when combined with the prior eight distributions, will equal 63.683 percent of each customer’s allowed claim amount, unless that claim has been fully satisfied. The aggregate amount distributed to eligible BLMIS customers will total nearly $11.4 billion, which includes more than $842.9 million in advances committed by the Securities Investor Protection Corporation (SIPC). All allowed customer claims up to approximately $1,375,000.00 will be fully satisfied after the distribution. The distribution is expected to commence by mid-February. Record holders of allowed claims as of January 30, 2018 will be eligible to receive payments from the ninth interim distribution.

The supplemental Ninth Customer Fund Allocation and Distribution Motion can be found on the United States Bankruptcy Court’s website at http://www.nysb.uscourts.gov/; Bankr. S.D.N.Y., No. 08-01789 (SMB). It can also be found on the SIPA Trustee’s website along with more information on the BLMIS liquidation at www.madofftrustee.com.

Link to the December 18, 2017 Press Release: http://www.madofftrustee.com/statements-19.html#813

 

Statement Regarding Bankruptcy Court Approval of Ninth Interim Pro Rata Distribution

December 18, 2017
Press Release: Madoff Trustee Requests Allocation of $1.3 Billion to Customer Fund and Court Approval to Immediately Distribute Approximately $584 Million to BLMIS Customers with Allowed Claims

Press release from the offices of Irving H. Picard, SIPA Trustee for the liquidation of Bernard L. Madoff Investment Securities LLC (BLMIS), and Stephen P. Harbeck, President and Chief Executive Officer of the Securities Investor Protection Corporation (SIPC)

 MADOFF TRUSTEE REQUESTS ALLOCATION OF
$1.3 BILLION TO CUSTOMER FUND
AND COURT APPROVAL TO IMMEDIATELY DISTRIBUTE
APPROXIMATELY $584 MILLION
TO BLMIS CUSTOMERS WITH ALLOWED CLAIMS

Ninth Pro Rata Interim Distribution Will Bring
Aggregate Customer Payout in Global Madoff Liquidation to More Than $11.4 Billion


NEW YORK, NEW YORK and WASHINGTON, DC– December 18, 2017 – Irving H. Picard, Securities Investor Protection Act (SIPA) Trustee for the liquidation of Bernard L. Madoff Investment Securities LLC (BLMIS), filed a motion today 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 ninth pro rata interim distribution from the Customer Fund to BLMIS customers with allowed claims. A hearing has been scheduled for Wednesday, January 31, 2018 at 10 a.m. EST.

Plans for the ninth pro rata interim distribution are the result of approximately $1.3 billion in settlements and recoveries achieved by the SIPA Trustee, his Chief Counsel David J. Sheehan, and their legal teams since the last interim distribution in February 2017. The most notable was the recovery agreement of approximately $687 million with the Thema International Fund as well as the approximately $370 million recovery agreement with the Lagoon and Thema Funds. With these and other additional settlement outcomes, including the $23 million recovery agreement with the estates of the Madoff sons, the SIPA Trustee stands ready to make a ninth pro rata interim distribution to allowed claimants of 3.585 percent on each allowed claim.

If the distribution motion is approved on January 31, 2018, the SIPA Trustee will allocate a total of approximately $1.3 billion to the BLMIS Customer Fund, with approximately $584.5 million available for immediate distribution to customers with allowed claims. The remaining allocation that was not previously paid to claimants will be held in reserve for claims that are deemed determined pending the resolution of litigation as well as other issues.

This ninth pro rata interim distribution, when combined with the prior eight distributions, will equal 63.683 percent of each customer’s allowed claim amount, unless that claim has been fully satisfied. The aggregate amount distributed to eligible BLMIS customers will total nearly $11.4 billion, which includes more than $842.8 million in advances committed by the Securities Investor Protection Corporation (SIPC).

Stephen P. Harbeck, President and CEO of SIPC, said, “The momentum of the SIPA Trustee and his teams continues to accelerate. Their successes set new benchmarks for future recovery efforts. SIPC has confidence that the Madoff Recovery Initiative will continue to deliver additional, significant distributions in 2018 and beyond. It is important to note that every single penny recovered by the Madoff Recovery Initiative goes to satisfy allowed customer claims. SIPC picks up all the costs of the Madoff Recovery Initiative as the Securities Investor Protection Act directs.”

“The progress of our teams has been remarkable,” said Mr. Picard. “Even now, nearly a decade since the unmasking of the Madoff fraud, we are still finding and recovering millions of dollars for the victims of this complex global deception. Additional distributions are still on the horizon and we remain committed to restoring as much of the stolen money as possible.”

“Both the direct and indirect investors in Madoff’s operation will benefit from this distribution, as they have from all the distributions to date,” said Mr. Sheehan. “Our teams had another productive and successful year in 2017, and we are pleased to move forward without delay to distribute as much of the 2017 recoveries as possible.”

The ninth pro rata interim distribution will result in the return of 3.585 percent of the allowed claim amount for each individual account, unless the allowed claim has been fully satisfied. The average payment amount to those 926 BLMIS accounts will be $631,198.93. The smallest payment totals $563.56 and the largest payment is $87,749,601.36. Claimants who qualified for hardship status under the SIPA Trustee’s Hardship Program will receive 15 payments.

To date, the SIPA Trustee has allowed 2,625 claims related to 2,265 accounts and the proposed distribution will be paid on claims related to 926 accounts. If the ninth pro rata interim distribution is approved by the Bankruptcy Court, when combined with SIPC advances and the amounts from the prior eight pro rata interim distributions, 1,386 accounts will be fully satisfied (all accounts with allowed claims of up to $1,375,000.00), leaving 879 accounts partially satisfied and entitled to participate in future distributions.

As of November 30, 2017 and since his appointment on December 15, 2008, the SIPA Trustee has recovered approximately $12.789 billion – nearly 73 percent of the currently estimated principal lost in the Ponzi scheme by those who filed claims. These outcomes exceed similar efforts related to prior Ponzi scheme recoveries, in terms of dollars and percentage of stolen funds recovered.

Ultimately, 100 percent of the SIPA Trustee’s recoveries will be allocated to the Customer Fund for distribution to BLMIS customers with allowed claims. All Trustee, legal and accounting fees, as well as administrative costs of the SIPA liquidation of Bernard L. Madoff Investment Securities LLC and its global recovery efforts, which make the distributions possible, are funded by SIPC.

Forty claims relating to 30 accounts are currently categorized as “deemed determined” claims still subject to litigation. Once litigation is either resolved or settled, these claims may be allowed and would therefore become eligible for all pro rata interim distributions to date. For that potential scenario, as of November 30, 2017, the SIPA Trustee has reserved approximately $1.579 billion. The ultimate amount of additional allowed claims depends on the outcome of litigation or negotiation and could add billions of dollars to the total amount of allowed claims.

Upon Bankruptcy Court approval, record holders of allowed claims as of January 31, 2018 will be eligible to receive payments from the ninth pro rata interim distribution.

The Ninth Customer Fund Allocation and Distribution Motion can be found on the United States Bankruptcy Court’s website at http://www.nysb.uscourts.gov/; Bankr. S.D.N.Y., No. 08-01789 (SMB). It can also be found on the SIPA Trustee’s website along with more information on the BLMIS liquidation at: www.madofftrustee.com.

Messrs. Harbeck, Picard and Sheehan would like to thank Oren Warshavsky, Seanna Brown and Heather Wlodek of BakerHostetler, who worked on the ninth pro rata interim distribution and its related filings, as well as BakerHostetler, Windels Marx and all of the attorneys and professionals whose work has led to the distribution. They would also like to thank Vineet Sehgal and his colleagues at AlixPartners, as well as Josephine Wang, Kevin Bell, Nathanael Kelley and their colleagues at SIPC, for their ongoing work and participation in the Madoff Recovery Initiative distributions.


Press Release: Madoff Trustee Requests Allocation of $1.3 Billion to Customer Fund and Court Approval to Immediately Distribute Approximately $584 Million to BLMIS Customers with Allowed Claims