As well, the allowed claims number only 2,175 under CICO. Under the FSM they would number 4,459, or 2,284 more. So in addition to paying, under CICO, more than twenty percent less than the maximum allowable, by using CICO rather than the FSM SIPC has shed itself of over 50 percent of the otherwise allowable claims of direct investors.
C. SIPC says there were "approximately 90,000 disbursements totaling $18.5 billion made to Madoff investors in excess of their investments" (P. 5). It says the Trustee has brought 19 avoidance actions seeking to recover about $15 billion, and it then says, in answer to the subcommittee's inquiry about future avoidance actions, that the Trustee (i) is considering "approximately 1,000 possible avoidance actions," against persons who had no knowledge of the fraud, "that could result in the recovery of approximately $4,800,000,000.00 for the benefit of creditors who have yet to recover their principal," and (ii) is considering another approximately "100 avoidance actions," against persons who "had enough information to be on inquiry notice of the fraud," "seeking the recovery of at least $2,000,000,000.00 for the benefit of customers who have yet to recover their principal." (P. 5.)
These statements have some crucial implications. One is that, despite any past protestations indicating the possible contrary, the Trustee is thinking about going after small investors who had no idea that there could be a fraud here. For as said above, very large percentages of the accounts are small fry, and it was small fry who were most likely to not have a breath of suspicion that there could be a fraud. Also, although the Trustee's figures play hide-the-ball on the question, I think it is possible that someone more adept at mathematics than I could pierce the ball-hiding and, by putting together various figures which appear in different places, could calculate how many of the 1,000 potential avoidance suits against innocent people would involve small investors. We can feel pretty confident it would be a lot.
Of course, it would be very valuable to have exact figures from SIPC, figures such as precisely how many of the 1,000 people who are innocent had accounts of less than one million dollars, how many had accounts of between one and three million dollars, how many had accounts of three to five million dollars, and ditto for five to ten million dollars and over ten million dollars. SIPC could produce this with the touch of a computer button, and it is probably a sure thing that the results would show that a major preponderance of the 1,000 persons are small fry.
As well, if the same exercise were performed for Congress by SIPC with regard to the possibly non innocent 100 who may have avoidance suits brought against them, it is dollars to doughnuts that the result would show that a large percentage of them are big investors: are hedge funds or banks or wealthy individuals with tens to scores of millions of dollars that were invested. It is after all, large players -- hedge funds, banks, etc. -- that had the capability to figure out that something must be wrong.
Next Page 1 | 2 | 3 | 4 | 5 | 6 | 7
(Note: You can view every article as one long page if you sign up as an Advocate Member, or higher).
