Bernie Madoff, mastermind of the Epic Ponzi scheme, dies. However, his efforts to break the net of deception are still ongoing.
More than 12 years after Madoff confessed to committing the biggest financial fraud in Wall Street history, a team of lawyers have been working to get money back for the thousands of victims of his fraud. We continue to make large-scale efforts.
Their labor has already secured $ 14.5 billion of the estimated $ 17.5 billion investors invested in Madoff’s fake investment business, but did not stop due to the death of a financier imprisoned in April. ..
An ongoing proceeding by Irving Picard, a trustee appointed to court for the liquidation of Bernie Madoff Investment Securities, and his chief attorney, David Sihan, will withdraw an additional billions of dollars. There is a possibility.
“You don’t want to see someone die, but in this case it didn’t affect our behavior,” Picard told The Associated Press. “Our job. Continues. “
Where to start
Shortly after the money manager was arrested in December 2008, a painstaking process began to eliminate Madoff’s fraud.
His downfall was the result of a national financial crisis in which a bank that was recklessly betting on mortgage-backed securities went bankrupt and investors rushed to withdraw money from the stock market.
Frightened investors also began to withdraw money from Madoff’s mutual funds, but Madoff ran out of money. His book stated that his fund was worth $ 60 billion, but most of that money was absent. He has never actually invested the cash he received from his client.
When a customer monetized a fictitious profit, Madoff simply covered the withdrawal from another customer.
Picard was given the task of separating Madoff’s customers who did not withdraw cash from their accounts and the “net losers” who did not withdraw cash.
Over time, net losers with approved claims quietly returned an average of 70% investment. The net winner was the target of so-called “clawback”. Not only did they lose the money they thought they had in their accounts, but they had to repay the profits they had withdrawn over the years.
“These people felt like they had been hurt twice, first by Madoff and then by this trustee,’give me a profit,'” Sheehan said.
The process was difficult for everyone. Some Madoff investors retired early. Some people bought a nice house on expensive land. Some people made large charitable donations, convinced that the nest eggs were safe.
“I was pretty scared”
Gordon Bennett believed that his account with Madoff was worth $ 3 million and undertook a major refurbishment at his home in Marin County, north of San Francisco.
When he learned that Madoff had been arrested, he told his wife, “Kate, we lost our house.”
I learned that the financial shock worsened months later, and that up to 10% of withdrawals per year for 25 years meant withdrawing more money than I had invested.
The Picard collector wanted his interests. Suddenly, Bennett was at risk of being added to the bucket of wealthy individuals and institutions suing, claiming that the trustees knew or should have known that their returns were fraudulent.
“It was pretty scary,” he said. “We finally made an arrangement with the trustee, sent him all the paperwork, and said,” Look, we don’t have the money. ” It was. So he finally said: “OK, I’m aiming for a bigger fish” “
And Picard did so with the help of a federal prosecutor. The biggest single chunk came in late 2010 when the widow of a Florida philanthropist agreed to return the marvelous $ 7.2 billion that her husband and businessman Jeffry Picower had in his pocket. A few months later, another $ 1 billion was secured from one of the many feeder funds that the trustee accused of ignoring the danger signal about Madov.
Recently, 74-year-old Bennett finds comfort in the same house after a friend buys it and lends it back to him.
“That is, we don’t currently have $ 3 million, but we don’t need $ 3 million,” he said.
Some victims contacted by AP said the news that Madoff died at the age of 83 during his 150-year sentence served only as a sad memory of their life-changing crimes.
Richard Shapiro, 68, who lives in Hidden Hills, California, said he had lost his “very important” net worth. Paniced, he temporarily put his house up for sale and made money again as a commercial real estate development manager without retiring.
Picard’s immediate success in recovering funds created a small industry of companies that provided Madoff’s victims with immediate cash in exchange for all rights collected by the trustee.
Shapiro jumped at the opportunity to sell one of Madoff’s money at a price much lower than its value, and another money with the money Picard could eventually get, save his home and live his life. I was able to start the reconstruction of.
“I’m regaining my original life now,” he said. But he said, “I don’t think anyone left it unharmed.”
Talk to Madoff
Sheehan remembered that there was one person who did not provide help for years. It’s a delusional Madoff.
“He actually complained to me that unfairly profitable people were making money, why did they complain? He liked them. “Sheehan said of his interactions with disgraceful financial firms, including a prison visit.” The money was stolen. It wasn’t a big benefit. “
Efforts to eliminate epic fraud continue after Madoff’s death
Source link Efforts to eliminate epic fraud continue after Madoff’s death