Judge mulls additional payment to Madoff victims
Bernard Madoff fraud victims in Manhattan on June 29, 2009 in New York City.
Stacey Vanek Smith: This week, in a New York City courtroom, a bankruptcy judge will decide if another couple billion dollars can be given back to victims of Bernie Madoff's Ponzi scheme. The question: who gets how much, and when?
Sabri Ben-Achour reports.
Sabri Ben-Achour: It’s estimated Madoff victims lost about $20 billion. So far, $1.1 billion has been returned. Why?
Brad Simon: Because of the number of people involved here this is a massive undertaking and it’s a long, drawn-out, painful process.
That’s white collar criminal defense attorney Brad Simon. Basically, hundreds of victims continue to elbow each other over how much they should get. And here’s the latest fight: If you invested with Madoff five years ago, should you get interest?
Anthony Sabino, professor of Business Law at St John’s University says:
Anthony Sabino: I have tremendous compassion for the victims here, but in all frankness, they’re barking up the wrong tree.
He says the law is pretty clear: victims almost never get interest on their losses. Plus, Sabino says, paying out interest to earlier victims would draw down the pot of money for more recent victims.
The judge will decide if money should be set aside for interest, or paid out now to everyone who got ripped off.
I’m Sabri Ben-Achour for Marketplace.