Bankruptcy Law
Madoff Investors Sue, Want Loss Calculation Based on Fake Statements
Posted Jun 8, 2009, 02:35 pm CST
By Sarah Randag
A group of investors in Bernard Madoff's $65 billion Ponzi scheme have filed suit in U.S. Bankruptcy Court in New York claiming trustee Irving Picard's calculations of money owed to victims is not in accordance with federal law.
The suit claims that federal law requires the investors to be paid the amounts reflected on their—fictional, since Madoff never bought or sold stock on behalf of his clients—statements, minus any fees owed to Madoff, Bloomberg reports.
The suit was filed by six elderly investors who say they lost $9 million between them, according to the Associated Press. While Picard has set up a process to expedite payments of $500,000 to eligible investors who lack funds for food, medical bills or child care, these investors are not eligible because they actually withdrew more money over the years than they invested, believing it was profit.
Picard told investors at a meeting earlier this year that client statements are "not what we are going to rely on," the Associated Press reported.