Madoff Trustee Fears For Recovery

Nov 7 2011 | 12:16pm ET

Buffeted by a series of crippling legal defeats, the court-appointed trustee in the Bernard Madoff case says he's not sure how much he'll be able to recover for the arch-fraudster's victims.

Picard has recovered $8.7 billion of the roughly $17.3 billion in principal lost in the $65 billion Ponzi scheme. But most of that money is tied up in appeals, and several recent court decisions appear to have severely limited the amount he'll be able to recover.

"We have a $5 billion settlement and a $1 billion settlement," Picard told Bloomberg News. "It's all being appealed."

Picard is doing some appealing of his own. In recent months, he's seen almost $30 billion in lawsuits against banks junked by judges, and a ruling in favor of the New York Mets' owners that could cut the amount he can recover from Madoff clients by more than $6 billion.

"Some of my authority to bring those actions has been called into question," Picard said. "We will be appealing those decisions. In my view, unless we are imaginative, creative and go after some of these things, the victims don't have a chance of becoming whole."

Despite his difficulties in making lawsuits against banks stick, Picard last week sued another, seeking almost $1 billion from BNP Paribas. According to the lawsuit, a Madoff feeder fund transferred $975.5 million to a BNP unit—and that feeder fund, Harley International, has not coughed up any of the $1.07 billion default judgment Picard one against it.


In Depth

Q&A: Brevan Howard’s Charlotte Valeur Talks Strategy

Sep 18 2014 | 11:18am ET

Charlotte Valeur chairs the board of Brevan Howard Credit Catalysts, an LSE listed...

Lifestyle

Hedgies Rock Out For Children's Charity

Sep 15 2014 | 8:40am ET

It's that time of year again—when hedgies trade in their spreadsheets for guitars...

Guest Contributor

Volkered: How Financial Sector Reforms are Creating Opportunities for Hedge Funds

Sep 16 2014 | 11:28am ET

New regulations have dramatically curtailed proprietary trading activity in investment...

 

Editor's Note

    Get A Sneak Peak Of The Alpha Pages

    Aug 25 2014 | 11:21am ET

    As many of you know, FINalternatives was recently acquired by the owners of Futures magazine, a firm called The Alpha Pages LLC. Today marks the soft-launch of a new sister site for both publications. As its name suggests, The Alpha Pages will cover all types of alternative investments, going far beyond the more well-known ones such as hedge funds and private equity. Read more…

 

Futures Magazine

September 2014 Cover

The London Whale: Rogue risk management

Credit default swaps brought down the London Whale and cost JPMorgan $6.2 billion. Here is how it happened.

The Alpha Pages

TAP July/August 2014 Cover

The Alpha Pages Interview: Senator Rand Paul

Senator Paul sat down in the debut series of the Alpha Pages Interview to discuss the broken tax code, regulation surrounding Bitcoin, and his plans for the 2016 Presidential election.