Madoff Victims Fund Covers Majority of Ponzi Scheme Losses: DOJ

The 10th and final distribution from the deceased’s sacrifice fund Ponzi scheme king Bernie Madoff began on Monday, Art Department of Justice said.

The latest payout of more than $131 million goes to more than 23,000 victims worldwide. When it is completed, more than $4.3 billion will be distributed by the fund to more than 40,000 victims in nearly 130 countries around the world, the Justice Department said.

That amount represents nearly 94% of estimated total fraud losses, the department said.

Final payment Madoff Victims Fund was announced some 16 years after Madoff’s fraud came to light.

“Today’s distribution represents an unprecedented outcome in compensating victims of civil asset forfeiture actions related to the Madoff scheme,” said James Dennehy, assistant director of the FBI’s New York field office.

“These victims implicitly trusted Madoff with their investments only to end up losing significant amounts of money as a result of his selfish scheme,” Dennehy said.

Madoff, led by Bernard L. Madoff Investment Securities in New York, pleaded guilty in March 2009 to 11 felonies in connection with what federal prosecutors called the largest Ponzi scheme in the world.

Madoff was sentenced to 150 years in prison for the fraud, which spanned four decades and involved paying clients with money obtained from other clients, rather than profits from investment trading, as he claimed.

He died in April 2021, at the age of 82, in a federal prison in North Carolina, nearly a year after he was denied a plea for compassionate release because of terminal kidney disease.

When Madoff’s fraud became known, prosecutors estimated the total damage at $65 billion. But that estimate plummeted after authorities subtracted the amount of phantom investment income and interest that Madoff’s clients were duped into.

The largest portion of funds for Madoff victims, about $2.2 billion, came from the foreclosure of the estate of Jeffrey Pickover, a now-deceased Madoff investor, the Justice Department said.

Another $1.7 billion came in JPMorgan Chase in the composition of a deferred prosecution agreement with the Ministry of Justice in January 2014. JPMorgan Chase and its predecessors served as the primary bank through which Madoff ran his scheme, the Justice Department previously said.

The rest of the victims’ funds came from a “civil forfeiture action against investor Carl Shapiro and his family, as well as civil and criminal forfeiture actions against Bernard L. Madoff, Peter B. Madoff and their accomplices,” the Justice Department said on Monday. .