More than $946 million in cash and securities have been rounded up in the worldwide search for assets held by accused swindler Bernard Madoff, but it will be several months before any of the money is disbursed to investors, a special trustee said yesterday.
Irving Picard, the attorney acting as trustee in the liquidation of Madoff's companies, disclosed the preliminary results of his search for assets following a hearing before Judge Burton Lifland in federal bankruptcy court in Manhattan.
As expected, Lifland later signed orders transferring more than $535 million in Madoff company funds found at JPMorgan Chase and New York Bank Mellon to Picard's control.
Madoff is suspected of ripping off as much as $50 billion from investors over the years, and the assets Picard said he has located as of Jan. 26 would only cover about 19 percent of the potential losses. Madoff is under house arrest at his Manhattan apartment on a $10-million bond.
News that Picard is finding money has raised some spirits among lawyers for investors.
"I thought that was pretty good news," said Howard Kleinhendler, who is representing the Rosenman family of Great Neck in a $10-million claim. "To the extent he gets some money is good."
Last month Picard agreed to segregate $10 million found at Chase so that it would be available to pay the Rosenman family if the claim is upheld.
But one person who wasn't pleased with yesterday's results was Craig Kugel, a Madoff employee who as a favor signed the lease for his boss' Mercedes-Benz. Lifland wouldn't release Kugel from the $1,700-a-month lease despite arguments by lawyer William Gogel.
"What is wrong is he doesn't even have the car," Gogel told Newsday, explaining that Picard's office returned the vehicle to Rallye Motors of Roslyn.
Outside of court, Picard said his office has received more than 8,000 claims. He said there is the potential for thousands more.
Picard, who was appointed under the authority of the nonprofit Securities Investor Protection Corp., said he intended to use the money to compensate investors on a pro-rata basis since the amount so far is well below the total claims. In addition, SIPC will provide bona fide investors a reimbursement of up to $500,000 for losses.
Picard acknowledged that the asset search is a complex task and told reporters more than 7,000 boxes of Madoff records found at a Queens warehouse are being examined.
"We are intent on doing our homework," Picard said.
He added he didn't expect payments to be made until perhaps July at the earliest.
FOUND MONEY
Funds recovered from companies of Bernard Madoff, accused in $50-billion scam:
$111.4 million in assets in various accounts
$535 million cash in JPMorgan Chase and New York Bank Mellon
$300 million in securities held by depository institutions (subject to valuation)
Total: $946.4 million
By Anthony M. Destefano for newsday.com (anthony.destefano@newsday.com)
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