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Madoff Fund Yet to Pay a Dime to 40,000 Victims

Image: Madoff Fund Yet to Pay a Dime to 40,000 Victims

Bernard Madoff walks in New York City in 2008. (DON EMMERT/AFP/Getty Images)

By    |   Wednesday, 24 May 2017 09:56 AM

The Madoff fund has yet to pay a dime to about 40,000 fraud victims, despite being ordered to distribute $4 billion recovered so far in the epic fraud.

The fund's namesake, former stockbroker Bernard Madoff, was arrested more than eight years ago after making over $67 billion in a Ponzi scheme, said USA Today. He now sits in prison.

Richard Breeden, former chairman of the SEC whose firm RCB Fund Services was tapped by the Department of Justive to oversee the distribution, said a first payout to victims was unsuccessful last year because of an overwhelming 63,580 claims of reported fraud.

Breeden's firm, which is also recovering assets from the Ponzi scheme, has racked up nearly $40 million in fees.

"We were unable to initiate our first payout in 2016 as we had hoped because of the volume and complexity of claims," Breeden said the fund's website. "However, we now expect that the initial distribution will take place sometime in 2017 and will be larger than we had anticipated."

Bloomberg News said the Madoff fund was created in December 2012 for the purpose of repaying the thousands of people who fell victim to the scam.

"It’s very frustrating that people are making money off us like this, using money that was recovered for victims," said Daphne Brogdon, a Food Network personality who lost about $5 million in the Madoff scheme. "They’re eating away at whatever percentage we could possibly get."

Jon Barooshian, a white-collar defense lawyer at Bowditch & Dewey in Boston, put a lot of the blame for the delay in repayment on the Department of Justice, accusing it of being "notoriously slow" when it comes to matters of this magnitude.

"I’m surprised it’s taking so long, but I don’t know if the fault will fall at Richard Breeden’s feet. It might be more of an internal DOJ issue," said Barooshian.

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The Madoff fund has yet to pay a dime to about 40,000 fraud victims, despite being ordered to distribute $4 billion recovered so far in the epic fraud.
madoff fund
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2017-56-24
Wednesday, 24 May 2017 09:56 AM
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