Washington, DC - The Department of Justice announced that the Madoff Victim Fund (MVF) began its second distribution of $504 million in funds forfeited to the U.S. Government in connection with the Bernard L. Madoff Investment Securities LLC (BLMIS) fraud scheme, bringing the total distributed to over $1.2 billion. These funds will be sent to over 21,000 victims across the globe. This distribution represents the second in a series of payments that will eventually return over $4 billion to victims as compensation for losses they suffered from the collapse of the BLMIS. The MVF has received over 65,000 petitions from victims in 136 countries.
Attorney General Jeff Sessions, Acting Assistant Attorney General John P. Cronan of the Justice Department’s Criminal Division and U.S. Attorney Geoffrey S. Berman for the Southern District of New York made the announcement.
“In one of the most notorious and unconscionable financial crimes in history, Bernie Madoff robbed tens of thousands of individuals, pension plans, charitable organizations and others, all the while funding a lavish personal lifestyle,” said Attorney General Sessions. “Through the use of asset forfeiture, the Department of Justice has recovered over $4 billion of Mr. Madoff’s fraud, and we continue to work to compensate those he defrauded. Last June, the Department approved more than 39,000 petitions for compensation. Today, during National Crime Victims’ Rights Week, the Department returns more than a half-billion dollars to nearly 22,000 law-abiding people and organizations. We cannot undo the damage that Bernie Madoff has done, but today’s distribution will provide significant relief to many of the victims of one of the worst frauds of all time.”
“Bernie Madoff committed history’s largest Ponzi scheme,” said U.S. Attorney Berman. “This Office prosecuted Madoff himself, and others who helped perpetrate his fraud, and continues to vigorously pursue money recoveries for his victims. Today’s payment of more than $500 million is this Office’s second installment in a series of distributions that represent our ongoing commitment to find relief for victims of Madoff’s heinous crimes.”
For decades, Bernard L. Madoff used his position as Chairman of BLMIS, the investment advisory business he founded in 1960, to steal billions from his clients. On March 12, 2009, Madoff pleaded guilty to 11 federal felonies, admitting that he had turned his wealth management business into the world’s largest Ponzi scheme, benefitting himself, his family and select members of his inner circle. On June 29, 2009, U.S. District Judge Denny Chin sentenced Madoff to 150 years in prison for running the largest fraudulent scheme in history. Judge Chin ordered Madoff to forfeit $170.799 billion as part of Madoff’s sentence.
Of the approximately $4.05 billion that will be made available to victims, approximately $2.2 billion was collected as part of the historic civil forfeiture recovery from the estate of deceased Madoff investor Jeffry Picower. An additional $1.7 billion was collected as part of a Deferred Prosecution Agreement with JPMorgan Chase Bank N.A. and civilly forfeited in a parallel action. The remaining funds were collected through a civil forfeiture action against investor Carl Shapiro and his family, and from civil and criminal forfeiture actions against Bernard L. Madoff, Peter B. Madoff and their co-conspirators.
The MVF’s payouts would not have been possible without the extraordinary efforts of the U.S. Department of Justice Criminal Division’s Money Laundering and Asset Recovery Section, the U.S. Attorney’s Office for the Southern District of New York, and the FBI in the prosecution of these crimes and the recovery of assets supporting the forfeiture in this case. The MVF is overseen by Richard Breeden, former Chairman of the U.S. Securities and Exchange Commission, in his capacity as Special Master appointed by the Department of Justice to assist in connection with the victim remission proceedings.