Bankruptcy Court Approves SIPC’s Madoff Liquidation Plan Limiting Payouts

On Tuesday, Dec. 23, US Bankruptcy Court Judge Burton Lifland approved a liquidation plan in the Madoff case proposed by the Securities Investor Protection Corp. The NY Post reports that the maximum  compensation victims are eligible for under the plan is $500,000 worth of securities, with no more than $100,000 of that $500,000 in the form of cash.  In addition, the court also approved SIPC’s plan to restrict claims to those investors who can prove they sent money to Madoff in the 12 months prior to his Dec. 11 arrest.

Steve Harbeck, chief executive of the SIPC, told the NY Post that the compensation limits were “the statutory rules of the SIPC.”  Madoff victims seeking more than compensation will need to pursue separate lawsuits or join in one of the many class action claims that have already arisen arisen out of the scandal.

Harbeck also stated that SIPC will be mailing claim forms to the thousands of customers he believes are eligible for SIPC compensation. “We will really be able to get this thing moving now,” he said.

The SIPC website now states that:

Irving H. Picard, the Trustee, will mail claim forms by no later than January 9, 2009, to customers and creditors of Madoff. In addition to being mailed, the forms will be available for downloading off of this site and www.madofftrustee.com. To make a claim against Madoff, you must use the Madoff claim form. You may not use the claim forms provided on this Web site for other SIPC liquidation proceedings.

Read the NY Post article

Visit the SIPC website

7 Comments

  • RJ Hettler
    Posted December 28, 2008, 12:30 pm 12:30 pm 0Likes

    What SIPC provisions are being made to victims of Thomas Petters of Minneapolis who embezzled in excess of $3.5 billion from me and others, and how does one make a claim with SIPC?

  • susan
    Posted December 29, 2008, 9:53 am 9:53 am 0Likes

    For Petters Fraud, I’m not sure if SIPC protects you as I think it’s for people purchasing securities, i.e, stocks and such. Do the research & hire a lawyer.

  • Trackback: SEC’s Case Against Madoff Will See Flurry of Activity on New Year’s Eve
  • Scott McNeil
    Posted December 30, 2008, 6:42 pm 6:42 pm 0Likes

    For more than thirty years I have been under the impression that SIPC did not provide coverage when fraud and dishonesty were involved–that was what fidelity bonding was for.

    Is this wrong, or has SIPC expanded their coverage in this situation for some reason?

  • Karen Murphy
    Posted January 15, 2009, 7:47 am 7:47 am 0Likes

    Does anyone have the court order that supports the statement: “In addition, the court also approved SIPC’s plan to restrict claims to those investors who can prove they sent money to Madoff in the 12 months prior to his Dec. 11 arrest.”

  • adil ali
    Posted March 31, 2009, 2:07 pm 2:07 pm 0Likes

    greetings i am investor in erounational funds from IRAQ my IQ26125994 did i will get compensation becuase i lost my money and my life become very diffcult please i wait your help to get my money thank you.

  • firas yasin
    Posted April 14, 2009, 11:55 pm 11:55 pm 0Likes

    iam investor in euronationalfunds did i will get compensation thank you

Comments are closed.