Madoff – Madoff victims seek help from Congress – Yahoo! News UK
Madoff victims seek help from Congress – Yahoo! News UK
At a U.S. House of Representatives hearing, Madoff victims described how the imprisoned swindler destroyed their lives and demanded that Congress take action.
“We need your help now,” Jeannene Langford told the House Financial Services subcommittee on capital markets. Langford said the money she had invested with Madoff represented 30 years of savings.
Under current law, some groups of Madoff victims have been told that they are either not eligible to be compensated the full amount of their last balance statement, or will not be repaid at all.
The trustee in charge of liquidating the Madoff's brokerage is also trying to “claw back” some funds that investors withdrew before Madoff was arrested.
The subcommittee chairman, Representative Paul Kanjorski, tried to temper hopes that Congress would make Madoff's victims whole. “We don't have the funds,” he told the panel of Madoff victims and their representatives.
Later, Kanjorski told reporters that the government could not be responsible for reimbursing every single fraud victim. “If you are going to have total guarantee against loss, you cannot have a market system because you can't pay the upside without having the losses,” he said.
Court-appointed trustee Irving Picard has so far recovered $1.4 billion of assets — a fraction of the $65 billion prosecutors said was recorded in Madoff's customer accounts.
Picard has received more than 15,900 claims from people who said they were Madoff victims, has reviewed nearly 3,000, and so far has rejected some 1,300.
Madoff victims are frustrated with the slow pace of payouts and the laws that dictate who is paid first when a brokerage firm is liquidated.
They are also upset with the method the Securities Investor Protection Corp (SIPC) and the trustee are using to determine how much money will be reimbursed.
SIPC is a non-profit agency created by Congress to maintain a fund to help investors who had accounts at failed brokerage firms. The agency can pay a single investor a maximum of $500,000.
SIPC, the trustee and the Securities and Exchange Commission agree that customer claims should be based on how much money the victim invested, not the amount the victim thought he had made from Madoff's fictitious investments.
Madoff ran a Ponzi scheme, where earlier investors were paid with money from later investors.
“The claims of the Madoff investors cannot be valued based on the balance shown on their final account statements,” said Michael Conley, the SEC's deputy solicitor.
“Although this approach would allow most Madoff account holders to receive payments on their claims, those payments would be based on account balances reflecting amounts that Madoff concocted that bear no relation to reality,” he said.
Helen Davis, a lawyer representing hundreds of Madoff victims, said her clients were not only hit by a “financial tsunami” when they found out Madoff swindled them, but by a “second tsunami” when SIPC could not reimburse them the full $500,000 allowable.
SIPC is grossly underfunded and has never had to deal with a liquidation the size of Madoff's brokerage.
Thefull House will debate legislation later this week that would increase the size of the fund and force brokerages to pay a percentage of their revenue to the fund, instead of a flat fee of $150 a year.
(Reporting by Rachelle Younglai, editing by Matthew Lewis and John Wallace)
We know the story now. Bernard Madoff conned thousands of investors into thinking they were making tons of money while in fact he was pocketing their investments through a complex Ponzi scheme. He was the one making the millions. The investors were making nothing. The sad fact is that the investors who lost by believing in Madoff will not know the luxury that he knew.
Think about the luxury home floor plan he probably had in his New York City apartment valued at seven million dollars. New York City has some of the most expensive price per square foot amounts in the world. The crowded city with its impressive skyscrapers is not cheap to live in. It is obvious that Madoff had a place in the right part of Manhattan with a great floor plan. He was living the good life of a New York City millionaire while the charitable organizations whose trust he was “investing” were working to make the poor of the city a little more comfortable.
What about his home in Florida? The sunshine state is a very popular state with New Yorkers, so it makes sense that he have a home there. But, did he need a home valued at eleven million dollars? The overall luxury home plan for this Palm Beach mansion must be super impressive. This most certainly was not a home designed for the family looking to escape the cold winds of New York City during the middle of winter; this has to be a home planned for the rich and famous.
Of course every hard working investor needs a country retreat. Although Madoff was not really investing, he was working hard at swindling. Madoff’s three million dollar home in Montauk, New York served this purpose. It would be interesting to see the luxury architecture home plans for his third home in the United States (he has a fourth home in France). It would definitely show what a true luxury home buyer should be looking for these days.
We do not believe most people will be able to build luxury architecture home plans that compare to Bernard Madoff’s residences, but we do believe that we can supply the average American home builder with a luxury home floor plan that compares to the plans used to design his homes. Plans of luxury are available at House Plans and More. Mr. Madoff will be busy for the next few years, but you can build your luxury home plan using these awesome plans this spring.
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