The trustee for Bernard Madoff’s investment firm, which is liquidating under U.S. government protection, proposed a repayment plan for investors and said it’s unclear whether there’s any money to fund it.
Customers may be paid in cash or securities if claims are deemed valid, trustee Irving Picard said in documents filed Monday in U.S. Bankruptcy Court in Manhattan.
“There has not been any showing or determination that there are sufficient funds of the debtor available to satisfy such claims,” Picard said in the papers. Some claims may be denied as the trustee compares them to Madoff’s records.
Investors had about $36 billion with Madoff’s firm, according to Bloomberg’s latest tally of disclosures and news reports. The firm is liquidating under Securities Investor Protection Corp. after Madoff was charged with running an alleged $50 billion Ponzi scheme. SIPC funds cover securities and cash claims of as much as $500,000 per customer, including up to $100,000 in cash.
Customers have 60 days to mail in a claim, Picard said. Investors who submit a claim after that deadline and within six months will receive “less protection,” he said. Broker-dealers must file claims within 30 days of Dec. 11.
Picard said he will mail notice to customers with an open account within 12 months prior to the filing by Jan. 9. A hearing will be held Feb. 4 on the retention of Picard as trustee, and a meeting for creditors will be held Feb. 18.
Picard proposes satisfying claims by distributing securities or, cash advanced by SIPC. Customers who have their claim rejected and dispute the decision should file a request for a hearing.