STATEMENTS & PRESS RELEASES
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March 08, 2021
Statement Regarding Thirty-Fifth 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 Monday, March 8, 2021, the SIPA Trustee and his Counsel at BakerHostetler filed the 35th 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, 2020 through November 30, 2020.

• The Application seeks approval of fees, representing approximately 63,202.50 hours of professional and paraprofessional services, which were billed at an average public interest discounted rate of approximately $503.31 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 $3,534,505.10. Additionally, the SIPA Trustee and BakerHostetler voluntarily adjusted their fees by writing off $1,255,598.90 (not including the 10 percent public interest discount), and wrote off expenses customarily charged to other clients in the amount of $21,519.95.

• 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 $31,810,545.90 (of which $28,629,491.30 is to be paid currently and $3,181,054.60 is to be held back through the conclusion of the liquidation period or until further order by the Court). In addition, $248,089.75 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, 2020 through November 30, 2020, without the need for protracted litigation, the SIPA Trustee settled 25 cases for $24,128,262.00. 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, 2020), the SIPA Trustee dismissed 284 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 over $14.413 billion through January 31, 2021. 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 $14.16 billion to BLMIS customers with allowed claims through February 26, 2021, which includes $849.8 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 $884.6 million. A second pro rata interim distribution commenced on September 19, 2012 and to date equals approximately $6.431 billion. The third pro rata interim distribution commenced on March 29, 2013 and to date equals approximately $900.7 million. The fourth pro rata interim distribution commenced on May 5, 2014, and the SIPA Trustee has distributed approximately $605.9 million. In the fifth pro rata interim distribution, which commenced on February 6, 2015, he has distributed approximately $522.2 million. In the sixth pro rata interim distribution, which commenced on December 4, 2015, the SIPA Trustee distributed approximately $1.567 billion. The seventh pro rata interim distribution commenced on June 30, 2016 and to date equals approximately $246.7 million. The eighth pro rata interim distribution commenced on February 2, 2017 and to date equals approximately $326.4 million. The ninth pro rata interim distribution commenced on February 22, 2018, and the SIPA Trustee has distributed approximately $716.3 million. The tenth pro rata interim distribution commenced on February 22, 2019, and the SIPA Trustee has distributed approximately $512.1 million. The eleventh pro rata interim distribution commenced on February 28, 2020, and the SIPA Trustee has distributed approximately $369.3 million. The twelfth pro rata interim distribution commenced on February 26, 2021, and the SIPA Trustee has distributed approximately $231.4 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 $849.8 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 $247.9 million in reimbursement.

The Bankruptcy Court hearing for approval of the 35th Fee Application has been scheduled for April 21, 2021 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 Thirty-Fifth Fee Application

February 26, 2021
Press Release: Twelfth Pro Rata Interim Distribution to BLMIS Claim Holders Commences; Totals More Than $231 Million

TWELFTH PRO RATA INTERIM DISTRIBUTION OF RECOVERED FUNDS
TO MADOFF CLAIMS HOLDERS COMMENCES;
TOTALS MORE THAN $231 MILLION

Aggregate Distributions Now Reach More Than $14.16 Billion

NEW YORK, NEW YORK and WASHINGTON, DC – February 26, 2021 – Irving H. Picard, Securities Investor Protection Act (SIPA) Trustee for the liquidation of Bernard L. Madoff Investment Securities LLC (BLMIS), announced that the twelfth pro rata interim distribution from the Customer Fund to eligible BLMIS customers commenced today.

The SIPA Trustee is distributing more than $231 million on a pro rata basis to BLMIS account holders with allowed claims. The aggregate amount distributed to eligible BLMIS customers will total more than $14.16 billion, which includes approximately $849.8 million in advances committed by the Securities Investor Protection Corporation (SIPC). The twelfth interim distribution represents 1.240 percent of each allowed claim and will be paid on claims relating to 813 accounts.

When combined with the prior eleven distributions, in aggregate, approximately 69.848 percent of each customer’s allowed claim will be paid, unless that claim has been fully satisfied.

“SIPC is pleased that funds continue to be recovered for the benefit of BLMIS customers, bringing the total amount returned to customers to more than $14 billion,” said Josephine Wang, SIPC President and CEO. “Thanks to the dedication of the Trustee, his legal team, and the SIPC team, the recoveries continue to surpass all expectations when this historic recovery initiative began 12 years ago.”

The twelfth 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 2020. The distribution includes the release of $175 million of a general reserve of $200 million that was previously allocated to the Customer Fund and held for unanticipated contingencies.

“Thanks to the support from SIPC, our team has been able to continue its work and recover far more than anyone ever expected,” said Mr. Picard. “Eligible BLMIS customers have now received almost 70 percent of their allowed claims, but we are optimistic that this figure will rise as we secure more recoveries and distributions in the future.”

“An important judicial decision last year cleared the path for more potential recoveries, and our team is working tirelessly to win these cases and help eligible customers get back as much money as possible,” said Mr. Sheehan. “Our success is a testament to the strength of our litigation activities and settlement negotiations, and I thank SIPC and our team for their unwavering commitment to the BLMIS liquidation effort.”

The average payment for an allowed claim in the twelfth interim distribution totals $284,638.81. The smallest payment totals $168.71 and the largest payment is $30,351,326.55. Currently, the SIPA Trustee has allowed 2,654 claims relating to 2,288 BLMIS accounts. Of these 2,288 accounts, 1,497 will be fully satisfied following the twelfth interim distribution. All allowed customer claims up to $1.655 million will be fully satisfied after the distribution.

As of January 31, 2021 and since his appointment in December 2008, the SIPA Trustee has amassed more than $14.413 billion as a result of recoveries and settlement agreements. These recoveries exceed similar efforts related to prior Ponzi scheme recoveries, in terms of dollar value and percentage of stolen funds recovered.

Subject to Court approval, 100 percent of the SIPA Trustee’s recoveries are allocated to the Customer Fund for distribution to BLMIS customers 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 liquidation can be found on the SIPA Trustee’s website: www.madofftrustee.com.

Ms. Wang and Messrs. Picard and Sheehan would like to thank BakerHostetler attorneys Seanna Brown and Heather Wlodek, who worked on the twelfth 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 Kenneth J. Caputo, Kevin H. Bell, Nathanael Kelley, Nicholas Hallenbeck, and their colleagues at SIPC, for their ongoing work and participation in the Madoff Recovery Initiative.

 

Press Release: Twelfth Pro Rata Interim Distribution to BLMIS Claim Holders Commences; Totals More Than $231 Million

January 19, 2021
Statement Regarding Bankruptcy Court Approval of Twelfth Pro Rata Interim 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:

NEW YORK, NEW YORK – January 19, 2021 – The United States Bankruptcy Court for the Southern District of New York today approved the SIPA Trustee’s request for an allocation of more than $74 million in recoveries to the BLMIS Customer Fund and has authorized the SIPA Trustee to proceed with the twelfth pro rata interim distribution of more than $190 million from the Customer Fund to BLMIS customers with allowed claims.

As previously announced, with today’s court approval, the SIPA Trustee will allocate more than $74 million to the BLMIS Customer Fund, with more than $190 million available for immediate distribution to customers with allowed claims. The distribution includes the release of $175 million of a general reserve of $200 million that was previously allocated to the Customer Fund and held for unknown contingencies.

This twelfth pro rata interim distribution, when combined with the prior eleven distributions, will equal at least 69.630 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 $14.12 billion, which includes advances committed by the Securities Investor Protection Corporation (SIPC). All allowed customer claims up to $1,645,761.48 will be fully satisfied after the distribution. The distribution is expected to commence by late February.

The Twelfth 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 9, 2020 Press Release: https://www.madofftrustee.com/document/news/001058-press-release-twelfth-allocation-and-distribution-vf.pdf

Statement Regarding Bankruptcy Court Approval of Twelfth Pro Rata Interim Distribution

December 09, 2020
Press Release: Madoff Trustee Requests Allocation of More Than $74 Million to Customer Fund and Court Approval to Distribute More Than $190 Million to BLMIS Customers with Allowed Claims

MADOFF TRUSTEE REQUESTS ALLOCATION OF MORE THAN $74 MILLION TO CUSTOMER FUND AND COURT APPROVAL TO DISTRIBUTE MORE THAN $190 MILLION TO BLMIS CUSTOMERS WITH ALLOWED CLAIMS

Twelfth Pro Rata Interim Distribution Will Bring Aggregate Customer Payout in Madoff Liquidation to More Than $14.12 Billion

NEW YORK, NEW YORK and WASHINGTON, DC – December 9, 2020 – 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 more than $74 million in recoveries to the BLMIS Customer Fund and an authorization for a twelfth pro rata interim distribution of more than $190 million from the Customer Fund to BLMIS customers with allowed claims. A hearing on the motion has been scheduled for Wednesday, January 20, 2021 at 10:00 a.m. EST.

Plans for the twelfth pro rata interim distribution are the result of more than $74 million in settlements and recoveries achieved by the SIPA Trustee and the legal teams since the last interim distribution in February 2020. The proposed distribution includes the release of $175 million of a general reserve of $200 million that was previously allocated to the Customer Fund and held for unknown contingencies.

“After nearly a dozen years, the SIPA Trustee and his legal team continue to identify and recover funds in the Madoff Ponzi scheme,” said Josephine Wang, President and Chief Executive Officer of the Securities Investor Protection Corporation (SIPC). “SIPC is proud to be a part of this successful recovery initiative. I congratulate the SIPA Trustee and his team as they continue, with the support of SIPC, to win significant victories for the Madoff customers.”

“With our next expected distribution, we will have returned to customers almost 70 percent of the money stolen by Bernard Madoff, much more than anyone ever predicted,” said Mr. Picard. “While our work is far from done, I thank my team for its ongoing, diligent efforts.”

“We thank SIPC for its support as we continue to pursue over $3.8 billion more in stolen funds,” said David J. Sheehan, Chief Counsel to the SIPA Trustee. “Recent judicial decisions will help the Trustee’s legal team continue to litigate worldwide, and we are confident that this will enable the SIPA Trustee to make additional distributions to BLMIS customers in the years ahead.”

Twelfth Distribution Will Bring Total Amount Restored to More Than $14.12 Billion

When combined with the prior eleven distributions, the twelfth distribution will equal 69.630 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 $14.12 billion, including approximately $849.338 million in advances committed by SIPC.

As of October 31, 2020, the SIPA Trustee has recovered or reached agreements to recover approximately $14.368 billion. This recovery far exceeds any prior restitution effort related to Ponzi schemes both in terms of dollars and percentage of stolen funds recovered.

The proposed distribution will be paid on claims relating to 813 BLMIS accounts and represents approximately 1.022% of their net equity claims, with an average payment amount of $234,631.52. When combined with the previous eleven distributions and $849.338 million in advances committed by SIPC, 1,490 accounts with an allowed claim amount of up to $1,645,761.48 will be fully satisfied following the twelfth interim distribution.

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 Twelfth 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.

Ms. Wang and Messrs. Picard and Sheehan would like to thank Seanna Brown and Heather Wlodek of BakerHostetler, who worked on the twelfth 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 Kenneth J. Caputo, Kevin H. Bell, Nathanael Kelley, Nicholas Hallenbeck, and their colleagues at SIPC, for their ongoing work and participation in the Madoff Recovery Initiative distributions.

 

Press Release: Madoff Trustee Requests Allocation of More Than $74 Million to Customer Fund and Court Approval to Distribute More Than $190 Million to BLMIS Customers with Allowed Claims

November 06, 2020
Statement Regarding Thirty-Fourth 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, November 6, 2020, the SIPA Trustee and his Counsel at BakerHostetler filed their 34th 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, 2020 through July 31, 2020.

• The Application seeks approval of fees, representing approximately 71,060.40 hours of professional and paraprofessional services, which were billed at an average, public interest discounted rate of approximately $486.43 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 $3,840,632.15. Additionally, the SIPA Trustee and BakerHostetler voluntarily adjusted their fees by writing off $1,389,603.70 (not including the 10% public interest discount), and wrote off expenses customarily charged to other clients in the amount of $9,462.20.

• 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 $34,565,689.35 (of which $31,109,120.42 is to be paid currently and $3,456,568.93 is to be held back through the conclusion of the liquidation period or until further order by the Court). In addition, $159,987.74 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, 2020 through July 31, 2020, without the need for protracted litigation, the SIPA Trustee settled 7 cases for $15,935,749.56. 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, 2020), the SIPA Trustee dismissed 284 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 $14.364 billion through September 30, 2020. 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 over $13.931 billion to BLMIS customers with allowed claims through September 30, 2020, which includes $849.34 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 $884.6 million. A second pro rata interim distribution commenced on September 19, 2012 and to date equals approximately $6.431 billion. The third pro rata interim distribution commenced on March 29, 2013 and to date equals approximately $900.7 million. The fourth pro rata interim distribution commenced on May 5, 2014, and the SIPA Trustee has distributed approximately $605.9 million. In the fifth pro rata interim distribution, which commenced on February 6, 2015, he has distributed approximately $522.2 million. In the sixth pro rata interim distribution, which commenced on December 4, 2015, the SIPA Trustee distributed approximately $1.567 billion. The seventh pro rata interim distribution commenced on June 30, 2016 and to date equals approximately $246.7 million. The eighth pro rata interim distribution commenced on February 2, 2017 and to date equals approximately $326.4 million. The ninth pro rata interim distribution commenced on February 22, 2018, and the SIPA Trustee has distributed approximately $716.3 million. The tenth pro rata interim distribution commenced on February 22, 2019, and the SIPA Trustee has distributed approximately $512.1 million. The eleventh pro rata interim distribution commenced on February 28, 2020, and the SIPA Trustee has distributed approximately $369.3 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 $849.34 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 $237.5 million in reimbursement.

The Bankruptcy Court hearing for approval of the 34th Fee Application has been scheduled for December 16, 2020 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 Thirty-Fourth Fee Application

July 09, 2020
Statement Regarding Thirty-Third 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, July 9, 2020, the SIPA Trustee and his Counsel at BakerHostetler filed their 33rd 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, 2019 through March 31, 2020.

• The Application seeks approval of fees, representing approximately 59,316.90 hours of professional and paraprofessional services, which were billed at an average, public interest discounted rate of approximately $479.29 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 $3,158,905.59. Additionally, the SIPA Trustee and BakerHostetler voluntarily adjusted their fees by writing off $1,589,620.50 (not including the 10% public interest discount), and wrote off expenses customarily charged to other clients in the amount of $156,784.30.

• 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 $28,430,150.31 (of which $25,587,135.29 is to be paid currently and $2,843,015.02 is to be held back through the conclusion of the liquidation period or until further order by the Court). In addition, $365,619.13 was requested as reimbursement of the actual necessary costs and expenses incurred by the SIPA Trustee and BakerHostetler in connection with the recovery effort. In addition, a $10,286,123.81 portion of the overall holdback amount of $20,572,247.62 was requested from the Bankruptcy Court with the consent and approval of the Securities Investor Protection Corporation (SIPC).

As noted in the Fee Application:

• During the Compensation Period of December 1, 2019 through March 31, 2020, without the need for protracted litigation, the SIPA Trustee settled 9 cases for $14,282,507.05. 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, 2020), the SIPA Trustee dismissed 281 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 $14.352 billion through May 31, 2020. 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 over $13.931 billion to BLMIS customers with allowed claims through May 31, 2020, which includes $849.34 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 $884.6 million. A second pro rata interim distribution commenced on September 19, 2012 and to date equals approximately $6.431 billion. The third pro rata interim distribution commenced on March 29, 2013 and to date equals approximately $900.7 million. The fourth pro rata interim distribution commenced on May 5, 2014, and the SIPA Trustee has distributed approximately $605.9 million. In the fifth pro rata interim distribution, which commenced on February 6, 2015, he has distributed approximately $522.2 million. In the sixth pro rata interim distribution, which commenced on December 4, 2015, the SIPA Trustee distributed approximately $1.567 billion. The seventh pro rata interim distribution commenced on June 30, 2016 and to date equals approximately $246.7 million. The eighth pro rata interim distribution commenced on February 2, 2017 and to date equals approximately $326.4 million. The ninth pro rata interim distribution commenced on February 22, 2018, and the SIPA Trustee has distributed approximately $716.3 million. The tenth pro rata interim distribution commenced on February 22, 2019, and the SIPA Trustee has distributed approximately $512.1 million. The eleventh pro rata interim distribution commenced on February 28, 2020, and the SIPA Trustee has distributed approximately $369.3 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 $849.34 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 $237.5 million in reimbursement.

The Bankruptcy Court hearing for approval of the 33rd Fee Application has been scheduled for August 26, 2020 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 Thirty-Third Fee Application

June 01, 2020
Statement: United States Supreme Court Denies Certiorari on Crucial Issue of Extraterritoriality

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

NEW YORK, NEW YORK – June 1, 2020 – The Supreme Court today denied a petition for a writ of certiorari that sought review of a February 25, 2019 Second Circuit ruling that allows the SIPA Trustee to recover funds stolen by Madoff and subsequently transferred overseas.

This denial paves the way for the SIPA Trustee to recover funds that were withdrawn from BLMIS by defendants in several dozen cases, including those against feeder funds and global banks, and subsequently redistributed to their managers. While the feeder funds themselves are largely insolvent, the SIPA Trustee will continue his recovery actions against subsequent transferees that received distributions originating with BLMIS. Chief Counsel David Sheehan estimates that the amount of potential recoveries at stake is approximately $3.2 billion, every penny of which would be distributed to BLMIS customers with allowed claims.

The SIPA Trustee and Mr. Sheehan would like to thank the attorneys who worked on this matter including: Seanna R. Brown and Torello H. Calvani of BakerHostetler; Roy T. Englert, Jr., D. Hunter Smith and Joshua S. Bolian of Robbins, Russell, Englert, Orseck, Untereiner & Sauber LLP; Howard L. Simon and Kim M. Longo of Windels Marx Lane & Mittendorf LLP; and Kenneth J. Caputo, Kevin H. Bell and Nathanael Kelley of the Securities Investor Protection Corporation.

Statement: United States Supreme Court Denies Certiorari on Crucial Issue of Extraterritoriality

April 23, 2020
Statement: Second Circuit Grants Madoff Trustee's Request for Direct Appeals in Legacy and Citibank Cases

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

NEW YORK, NEW YORK –April 23, 2020 –Today the U.S. Court of Appeals for the Second Circuit granted the SIPA Trustee’s request for direct appeals of the Bankruptcy Court judgments entered in Picard v. Legacy Capital Ltd., et al. and Picard v. Citibank, N.A., et al. Irving H. Picard issued the following statement in connection with the Second Circuit’s decision:

“The appeals arise from adversary proceedings the Trustee brought under SIPA and the Bankruptcy Code to recover property that was fraudulently transferred by BLMIS. After nearly a decade of litigating the Legacy action, the Citibank action, and other adversary proceedings before the Bankruptcy and District Courts, fundamental questions regarding the pleading standards for avoidance and recovery of fraudulent transfers in SIPA cases remain unsettled.

“The heart of the matter centers on a 2014 District Court decision. The District Court held that a SIPA trustee must plead the absence of good faith, with particularized allegations, as part of his prima facie case to avoid and recover transfers under the Bankruptcy Code, even though good faith is an affirmative defense under the Bankruptcy Code. In addition, the District Court discarded the ‘inquiry notice’ standard used to evaluate good faith in bankruptcy cases. In its place, the District Court set forth a heightened standard of willful blindness that the Trustee must meet in SIPA actions to recover fraudulent transfers.

“Through these direct appeals, we are asking the Second Circuit to reverse the rulings by the Bankruptcy and District Courts on the basis that they are inconsistent with precedent and wrongly preclude the SIPA Trustee from recovering hundreds of millions of dollars for distribution to those who were most affected by the Madoff Ponzi scheme – the hundreds of victims who, after all these years, have never received back what they deposited with BLMIS.”

Statement: Second Circuit Grants Madoff Trustee's Request for Direct Appeals in Legacy and Citibank Cases

March 11, 2020
Statement Regarding Thirty-Second 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 Wednesday, March 11, 2020, the SIPA Trustee and his Counsel at BakerHostetler filed their 32nd 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, 2019 through November 30, 2019.

• The Application seeks approval of fees, representing approximately 64,467.80 hours of professional and paraprofessional services, which were billed at an average, public interest discounted rate of approximately $465.75 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 $3,336,236.44. Additionally, the SIPA Trustee and BakerHostetler voluntarily adjusted their fees by writing off $1,539,577.20 (not including the 10% public interest discount), and wrote off expenses customarily charged to other clients in the amount of $153,153.08.

• 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 $30,026,127.96 (of which $27,023,515.17 is to be paid currently and $3,002,612.79 is to be held back through the conclusion of the liquidation period or until further order by the Court). In addition, $316,885.66 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, 2019 through November 30, 2019, without the need for protracted litigation, the SIPA Trustee settled 12 cases for $888,855,150.43. 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, 2019), the SIPA Trustee dismissed 281 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 $14.334 billion through January 31, 2020. 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 $13.930 billion to BLMIS customers with allowed claims through February 28, 2020, which includes $848.2 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 $884.6 million. A second pro rata interim distribution commenced on September 19, 2012 and to date equals approximately $6.431 billion. The third pro rata interim distribution commenced on March 29, 2013 and to date equals approximately $900.7 million. The fourth pro rata interim distribution commenced on May 5, 2014, and the SIPA Trustee has distributed approximately $605.9 million. In the fifth pro rata interim distribution, which commenced on February 6, 2015, he has distributed approximately $522.2 million. In the sixth pro rata interim distribution, which commenced on December 4, 2015, the SIPA Trustee distributed approximately $1.567 billion. The seventh pro rata interim distribution commenced on June 30, 2016 and to date equals approximately $246.7 million. The eighth pro rata interim distribution commenced on February 2, 2017 and to date equals approximately $326.4 million. The ninth pro rata interim distribution commenced on February 22, 2018, and the SIPA Trustee has distributed approximately $716.3 million. The tenth pro rata interim distribution commenced on February 22, 2019, and the SIPA Trustee has distributed approximately $512.1 million. The eleventh pro rata interim distribution commenced on February 28, 2020, and the SIPA Trustee has distributed approximately $369.3 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 $848.2 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. Under SIPA, SIPC must be reimbursed for its advances to customers. To date, SIPC has received approximately $237.5 million in reimbursement.

The Bankruptcy Court hearing for approval of the 32nd Fee Application has been scheduled for April 29, 2020 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 Thirty-Second Fee Application

March 03, 2020
Statement Regarding Court Order Related to Victim Letters and Communications

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

Bernard L. Madoff filed a motion on February 5, 2020 in the United States District Court for the Southern District of New York (the “Court”) for a sentencing reduction pursuant to 18 U.S.C. § 3582 and the First Step Act. The Honorable Denny Chin, U.S. Circuit Judge, invited Madoff’s victims to submit letters with their views on this motion by February 28, 2020.

The Reporters Committee for Freedom of the Press, and other news organizations, recently asked the Court to make those victim letters publicly available without redaction of the victims’ last names. Any objections to this requested relief must be made by 5:00 p.m. on March 6, 2020. For further information, please visit the Court’s Order posted on the SIPA Trustee’s website:

https://www.madofftrustee.com/document/dockets/009978-09-cr-00213usa-v-madoff-court-orderecf2203220.pdf

Statement Regarding Court Order Related to Victim Letters and Communications