First payouts to Madoff victims set to begin

Reuters News
Posted: Oct 05, 2011 3:23 PM

(Reuters) - The first checks to investors defrauded by Bernie Madoff will be mailed out on Wednesday, according to the trustee overseeing the liquidation of the investment fund.

That initial disbursement will total $312 million in recovered money, the trustee, Irving Picard said in a statement, and will represent a payout of about 4.6 cents for every $1 lost to the 1,230 accounts included.

"The need among many Madoff customers is urgent, and we are working to expedite these distributions," he said.

Picard is the trustee for the defunct Bernard L. Madoff Investment Securities LLC, the investment advisory arm of which was at the center of a multibillion-dollar, decades-long Ponzi scheme. Madoff ran a classic Ponzi scheme: when investors needed to be paid, he used money deposited by other investors.

Picard has filed more than 1,050 lawsuits on behalf of former Madoff customers seeking more than $94 billion. Madoff, 73, was arrested in December 2008 and pleaded guilty in March 2009. He is serving a 150-year prison term.

(Reporting by Matt Daily in New York; Editing by Gary Hill)