The Madoff Ponzi Scheme: For every $1 “invested” how much have investors recovered? More Than MF Global Shareholders
September 12, 2014 Leave a comment
In this day and age, the name ‘Madoff’ is synonymous with ‘financial fraud’, ‘ponzi scheme’, etc. Yet how much harm has Madoff done, in $ terms and % terms? While Madoff’s wrong-doings are indisputable, the damage all too real for its victims, the answer may surprise you…
As of July 23, 2014, the Securities Investor Protection Act (SIPA) Trustee has recovered or entered into agreements to recover approximately $9.825 billion, representing approximately 56 percent of the estimated $17.5 billion in principal lost in the Ponzi scheme by Bernard L. Madoff Investment Securities LLC (BLMIS) customers who filed claims. This recovery far exceeds any prior restitution effort related to Ponzi schemes both in terms of dollar value and percentage of stolen funds recovered.
Madoff’s victims have recovered 56% of their principal, whereas Corzine/MF Global’s victims – I mean, shareholders – is ZERO. To be fair, Madoff’s scheme and lies were longer lasting, and probably much more deliberate/malicious. Yet economically, who has harmed investors more? I will that to those far wiser to answer, but I believe it is a fair question.