SIPC, Trustee Issue Statement on Initial Recovery of Assets in Madoff Liquidation Proceeding
Claim Form Mailing in Madoff Liquidation to Proceed on or before
"We are pleased that today the United States Bankruptcy Court for the Southern District of
We want to be very clear that to the extent these and other funds are 'customer property,' they will be used for satisfying customer claims and not the administrative expenses of the Trustee. Contrary to some recent media accounts, trustee expenses are paid out of any general estate of the debtor, and if insufficient, through advances by SIPC. Customer property may not be used to pay the administrative expenses of a liquidation proceeding. Under the Securities Investor Protection Act, the trustee is empowered to recover customer property so that it may be returned to customers in need of protection under that law. Because expenditures by the trustee to recover such property and other administrative expenses of the trustee are borne by the general estate and SIPC and not by customers, such expenditures diminish in no way the amount of customer property available for customers.
Separately, we want it to be known that a claim form will be available shortly for the Madoff liquidation proceeding. The Trustee will mail claim forms by no later than
The Securities Investor Protection Corporation is the U.S. investor's first line of defense in the event a brokerage firm fails, owing customer cash and securities that are missing from customer accounts. SIPC either acts as trustee or works with an independent court-appointed trustee in a brokerage insolvency case to recover funds.
The statute that created SIPC provides that customers of a failed brokerage firm receive all non-negotiable securities -- such as stocks or bonds -- that are already registered in their names or in the process of being registered. At the same time, funds from the SIPC reserve are available to satisfy the remaining claims of each customer up to a maximum of
For more information about SIPC, see "The Investor's Guide to Brokerage Firm Liquidations" at http://www.sipc.org/pdf/SIPC_brochure_Investors_Guide_To_BD_Liquidations.pdf.
SOURCE Securities Investor Protection Corporation,