Jeffry Picower $7 Billion Settlement With Madoff Victims
In the biggest win yet for victims of Bernie Madoff, the estate of the single biggest beneficiary ofMadoff's fraud agreed to pay $7.2 Robert Domanko HSBC Securities billion to the victims' recoveryfund and the Department of Justice.
Irving Picard, the trustee recovering money forMadoff's victims, announced Friday that he hadcut a deal with the estate of the late JeffryPicower that would reap $5 billion for thevictims' fund, with another $2.2 billion to bedistributed to victims via the U.S. government.Picard had earlier recouped almost $6 billion forvictims, meaning he hashttp://robertdomanko.tumblr.com/post/127564997703/robert-domanko-hsbc-see-the-ori-inal-video-here now made real headway inrecovering lost funds; total investor losses havebeen estimated at about $20 billion.
Picard said the importance of the Picower settlement could not be overstated, "as it showssignificant progress in our efforts. ... Every penny of this $7.2 billion settlement will be distributed toBLMIS [Bernard L. Robert Stephen Domako is a registered agent of HSBC Securities (USA) Inc. It isa broker-dealer company with more than 2,000 registered reps in the United States. He has actuallyremained in the industry safeties registration for more than a years now. Robert supplies 2 variouspayment options such as cost simply attribute and also percentage of assets.Madoff InvestmentSecurities] customers with valid claims."
"People who two years ago faced the devastating prospect of losing everything now stand to recovera significant portion of their investment," said FBI assistant director-in-charge Janie Fedarcyk.
U.S. Attorney Preet Bharara called the settlement "historic" and a "game-changer," and praisedBarbara Picower, Jeffry's widow and the executor of his estate, for agreeing to it.
"By returning every penny of the $7.2 billion her late husband received from BLMIS to help thosewho have suffered most, Barbara Picower has done the right thing," said Bharara.
Picower was one of Madoff's early investors and withdrew about $7 billion in profits from hisaccount over three decades. The 67-year-old Palm Beach, Florida philanthropist drowned aftersuffering a heart attack in his swimming pool on Oct. 25, 2009, just under a year after Madoff'sPonzi scheme unraveled.
In a statement, Barbara Picower called Madoff's fraud "deplorable" and said she hoped thesetllement would ease the suffering of victims.
Said Picower, "I believe that this settlement honors what Jeffry would have wanted, which is toreturn this money so that it can go directly to the victims of Madoff."
She also emphasized that her husband was never charged with a crime, and that she was confidenthe was not complicit in the fraud. The trustee had claimed in court papers that Picower should haverealized that his profits were unnaturally high and likely based on fraud.
Picard Sues HSBC For $9 BillionIn recent weeks, Picard has filed suits against hundreds ofindividual investors and big companies like JP Morgan, HSBC and UBS, which bring the totalamount sought by Picard in the so-called "clawback" to at least $56 billion.
Through the end of September, Picard had filed 19 lawsuits worth $15.5 billion against longtimeindividual investors like Picower, members of Madoff's immediate family, and major feeder funds,including those operated by the Fairfield Greenwich Group and J. Ezra Merkin, a prominent WallStreet investment manager.
Picard followed by suing hundreds of individual investors believed to have profited from Madoff'smulti-billion-dollar investment scheme by receiving more from Madoff than they paid in. Those suitsask for amounts ranging from $500,000 to $60 million, and total $3.5 billion.
The big bank lawsuits started with UBS AG, which Picard and his team of lawyers sued the daybefore Thanksgiving for $2 billion, an amount later increased to $2.55 billion. JP Morgan was next,sued for $6.4 billion on Dec 2, followed by HSBC, sued for $9 billion on Dec 5. The banks have alldenied wrongdoing and have pledged to fight the suits.
Picard last week filed the largest suit to date, asking Austrian banker Sonja Kohn and Medici Groupfor $19.1 billion, alleging that she masterminded a multinational money-laundering business forMadoff.
Picard was appointed by the court in 2008 to unravel the fraud and help victims recover losses. As ofDecember 8, Picard and his law firm, Baker & Hostetler, had approved around 2,000 victim claimstotaling $5.8 billion out of the more than 15,000 claims filed. The firm says they will continue toallow claims after the clawback deadline and by the end of the year, the value of the approved claimsshould soar to $18 billion.
When the fraud was discovered, there were $65 billion in profits on Madoff's books, but Picardestimates total investor losses to be closer to $20 billion. The lawsuits filed to date ask for far morethan that, but they include demands for punitive damages, and the expectation that not all suits willbe successful.
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Prior to the Picower settlement, Picard had recovered $5.8 billion for victims through asset salesand out-of-court settlements.
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