Madoff Trustee Seeks $535M To Pay Back Investors

Madoff Trustee Seeks $535M To Pay Back Investors - 1/30/2009

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HEADLINES \| SETTLEMENTS AND DISMISSALS \| COURT FILINGS LINKS TO OTHER NEWS \| NEWS ARCHIVE	HEADLINES ARCHIVED SETTLEMENTS AND DISMISSALS ARCHIVED

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Madoff Trustee Seeks $535M To Pay Back Investors
Ben James

Securities Law 360. January 30, 2009
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EXCERPT: The Securities Investor Protection Corp. trustee for Bernard L. Madoff Investment Securities LLC and two banks have proposed an agreement under which the banks would wire the trustee $535 million to bolster recoveries for investors with the disgraced financier's firm. At a Feb. 4 hearing, Judge Burton Lifland of the U.S. Bankruptcy Court for the Southern District of New York will be asked to sign off on two orders that would approve stipulations calling for JPMorgan Chase Bank NA to transfer $233.5 million and the Bank of New York to transfer $301.4 million to trustee Irving H. Picard on or before Feb. 6, according to court papers. Picard and the banks have agreed to terms for the transfer of the funds, and the U.S. Securities and Exchange Commission has no objection, according to the stipulations, which also say that Picard intends the funds to be allocated as customer property and made available for distribution to customers. The funds are in four accounts — three at JPMorgan and one at the Bank of New York — that are held by the Madoff brokerage. Picard's attorneys were not available for comment Friday, and spokespersons for JPMorgan and BoNY could not be immediately reached to discuss the case. Picard was appointed trustee of Madoff's investment firm pursuant to the Securities Investor Protection Act on Dec. 15. Madoff remains under house arrest after federal prosecutors hit him with a criminal charge of securities fraud on Dec. 11. Madoff allegedly bilked investors out of as much as $50 billion through a massive Ponzi scheme. Also on Dec. 11, the SEC sued Madoff, charging him with securities fraud in connection with the alleged Ponzi scheme. He faces a possible 20-year prison term if convicted. According to authorities, Madoff told two senior employees that he had nothing;

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