Which Madoff victims get SIPC help?
TEXT OF STORY
Steve Chiotakis: We’re set to get more insight today into the world of Bernard Madoff. A federal judge in New York will take up several key issues in the alleged fraud that prosecutors say could add up to $50 billion. And authorities want to get a clear picture of whether investors can get some of their money back, and how much. Here’s Marketplace’s Jeremy Hobson.
Jeremy Hobson: One key safety net for Madoff victims is the Securities Investor Protection Corporation, or SIPC. In many cases, SIPC can pay up to $500,000 to people who were invested directly with Madoff. Today, Judge Louis Stanton will consider whether indirect investors — who invested in funds that invested with Madoff — can file claims with SIPC as well.
But, says Wall Street attorney Michael Bachner:
Michael Bachner: I think SIPC only has several billion dollars at most. And given the amounts of losses, it’s certainly better than nothing, but it’s certainly not enough to cover the amounts of money lost by these investors.
Also today, Madoff will have to disclose exactly what assets he and his firm still have. On that front, Bachner says:
Bachner: What he should try and do in order to keep his jail exposure down — because he’s going to go to jail for a long time no matter what he does — is to try and get the money back, to track it down and explain what happened.
Next week, the first notices will go out to Madoff customers affected by the scam.
In New York, I’m Jeremy Hobson for Marketplace.
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