Friday, 1 August 2014
Last updated 1 hour ago
May 27 2009 | 8:23pm ET
A pair of Bernard Madoff feeder hedge funds has agreed to settle with the court-appointed trustee in the case, returning more than $200 million they withdrew from their Madoff accounts in the months before his $65 billion Ponzi scheme collapsed.
The two Bahamas-domiciled funds managed by Banco Santander’s Optimal Investment Services will return $285 million, 85% of the total they withdrew from Bernard L. Madoff Investment Securities in the 90 days before his arrest in December. In exchange, the funds would be protected against further claims by the trustee, Irving Picard, and will receive $500,000 for their own claims against Madoff.
The deal still requires the approval of the U.S. Bankruptcy Court overseeing the liquidation of Madoff’s empire.
“I am very pleased that we have reached such a favorable settlement,” Picard said. “We hope that other entities against which we have claims will likewise come forward to settle those claims for the benefit of all of Madoff’s victims.”
Those wishing to do so now know what they are in for: at a minimum, agreeing to return 85% of their withdrawals in the 90 days before Madoff’s arrest. If Picard reaches a better deal with any other party, he must retroactively offer it to the Optimal funds.
The agreement also boosts the amount Picard has recouped for the victims of the fraud to more than $1.25 billion.