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Bernie Madoff victims to begin receiving compensation

By
Ray Downs
Bernard Madoff, pictured at New York court in 2009, is serving a 150-year prison sentence in connection with the largest case of financial fraud in U.S. history. File Photo by Monika Graf/UPI
Bernard Madoff, pictured at New York court in 2009, is serving a 150-year prison sentence in connection with the largest case of financial fraud in U.S. history. File Photo by Monika Graf/UPI | License Photo

Nov. 9 (UPI) -- Victims of convicted hedge fund fraudster Bernie Madoff will start to receive payments from a compensation fund, the Department of Justice announced Thursday.

The initial distribution of funds from the Bernie Madoff Victim Fund will send $772.5 million to 24,631 victims around the world. They will mark the first payments in what is expected to amount to over $4 billion in victim compensation. More than 65,000 people in 136 countries have applied through the Madoff Victim Fund.

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The Justice Department said the combined payments will mark the largest ever distribution of forfeited funds.

"We have recovered billions of dollars from third parties -- not Mr. Madoff -- and are now returning that money to tens of thousands of victims," said U.S. Deputy Attorney General Rod Rosenstein.

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Fund administrator Richard Breeden said in June that more than 35,000 petitions claiming total losses of more than $6.5 billion had been approved by the department, Bloomberg reported.

The fund was created in 2012 after the U.S. authorities seized $2.4 billion from the estate of one of Madoff's largest investors, Jeffry Picower. JPMorgan Chase, which was accused of ignoring illegal activity committed by Madoff, contributed $1.7 billion in 2014 as part of a deal with U.S. authorities.

"The remaining funds were collected through a civil forfeiture action against investor Carl Shapiro and his family, and from civil and criminal forfeiture actions against Bernard L. Madoff, Peter B. Madoff and their co-conspirators," the department said.

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Madoff pleaded guilty in 2009 to charges surrounding what's considered to be the largest financial fraud scheme in U.S. history, in which he bilked investors out of more than $60 billion. He's serving a 150-year sentence in federal prison.

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