Fifteen years after Bernie Madoff was sentenced to prison for running the largest Ponzi scheme in history, a fund set up by the U.S. government to compensate his former clients is winding down.
The Justice Department announced in a news release Monday that the Madoff Victims Fund will distribute more than $131 million in its 10th and final round of payments. According to the Justice Department, the total compensation would be $4.3 billion, covering about 41,000 people in 127 countries.
According to the Department of Justice, each person compensated through the fund will recover nearly 94% of their proven losses. The ministry said the final payout was “the culmination of a decade of work identifying thousands of victims and unraveling the layers of complex financial transactions around the world.”
According to the Justice Department, the Madoff Victims Fund began compensating people in 2017, with most of the money coming from the late Jeffrey Madoff, who was a Madoff investor and one of the biggest beneficiaries of his scheme. It is said to come from assets recovered from Picower’s estate.
Some victims have received compensation through court-appointed receivers who work to uncover fraud and recover funds from investors. Court-appointed trustee Irving Pickard distributed about $14 billion to former Madoff clients, CNN reported.
Madoff, a Wall Street financier and former Nasdaq chairman, was sentenced to 150 years in prison in 2009 after pleading guilty to 11 federal felonies, including multiple counts of fraud. He passed away in 2021 at the age of 82.
By the time he was arrested in his Manhattan penthouse in 2008, he had been defrauding clients for decades through his wealth management company. CNBC reported that this included repaying clients with funds collected from other clients, rather than with profits from investment transactions as he claimed.
Wealthy families, large charities and universities suffered losses, but the Justice Department said most of the victims were small investors who each lost about $250,000.
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