Kenyans among 51,700 seeking Madoff ponzi scheme refund
A man holds a sign referring to fraudster Bernard Madoff outside Madoff’s luxury apartment in New York before the swindler was arrested. Photo/REUTERS
What you need to know:
The scheme hit investors from 119 countries. Kenyans are among investors from 17 African countries that were caught up in the scam.
Many of the claims were filed by banks or fund managers who “are not generally eligible” to share in the forfeited money.
The US Justice Department fund set up to help victims of Bernard Madoff’s Ponzi scheme says Kenyans are among the 51,700 investors seeking some of the Sh348billion ($4 billion) forfeited since the swindle collapsed.
The scheme hit investors from 119 countries. Kenyans are among investors from 17 African countries that were caught up in the scam.
The statement does not offer any details on the Kenyan investors, including their count, worth of losses or whether they are individual or institutional investors.
In total, the claims received by the April 30 filing deadline represent the $40 billion lost to the fraud, said Richard Breeden, who was appointed to handle distributions, in a release.
“The flood of claims submitted to the MVF (Madoff Victim Fund) gives a new indication of the size and global reach of the Madoff fraud,” said Mr Breeden. “This fraud was of epic, and truly global, proportions.”
Many of the claims were filed by banks or fund managers who “are not generally eligible” to share in the forfeited money, Breeden said.
“The claims received have not yet been reviewed to eliminate ineligible, duplicate or overstated claims, which MVF expects to be substantial,” Mr Breeden said.
The Madoff investment scandal broke in December 2008, when former NASDAQ chairman Bernard Madoff admitted that the wealth management arm of his business was an elaborate Ponzi scheme.
Madoff’s personal and business asset freeze created a chain reaction throughout the world’s business and philanthropic community, forcing many organisations to at least temporarily close.
Madoff, 76, was arrested in December 2008, pleaded guilty three months later, and is now serving a 150-year prison term.
Breeden is allowing “indirect” investors who had accounts at so-called “feeder funds,” hedge funds, banks and other entities that sent their money to Madoff to try to recoup their losses.
In contrast, Irving Picard, a court-appointed bankruptcy trustee winding down Bernard L. Madoff Investment Securities LLC, has allowed only direct investors to recover.
Picard has recouped $9.8 billion (Sh852.6 billion), roughly 56 per cent of the $17.5 billion (Sh1.5 trillion) in principal he said was lost by those who submitted claims, and distributed nearly $6 billion (Sh522 billion). The trustee said he accepted 2,518 of the 16,519 claims he received.
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