Costs of doing right by Madoff victims soar
Bernard Madoff has long since been banished to prison, where he is increasingly less newsworthy.
And The long march to clawback ill-gained funds from the criminal enterprise, an effort that was once such a cause celebre, has run into some roadblocks. At some point, one has to wonder whether the effort is still worth the costs.
Bloomberg notes that more than three years after the Ponzi Scheme surfaced, "winding down the Madoff estate has cost more than Picard has sent to customers."
Picard has so far paid aggrieved investors back about $330 million. But "as of March 31, Picard himself has been paid about $5.1 million in fees. His law firm, Baker & Hostetler LLP, has been paid about $262.2 million in fees. All professional fees and expenses now stand at about $522 million, with about $31.7 million having been spent on general administrative costs such as office rent and telephones. By 2014, the bill will top $1 billion, Picard has estimated."
The industry-financed SIPC, which pays Madoff, no longer expects Picard to pay all currently allowed claims of $17.3 billion in full. At some point, the gig may be up. Certainly, the litigation over Picard's attempts will stretch out for years, and the last thing anyone wants is for this to turn into even more of a financial sinkhole. We may have indeed reached the point of diminishing returns.
- here's the article
Even in prison, Bernie Madoff is still Bernie Madoff