Good News For Madoff Victims: $7.2 Billion Recovered

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The big bank lawsuits started with UBS AG, which Picard and his team of lawyers sued the day before Thanksgiving for $2 billion, an amount later increased to $2.55 billion. JP Morgan was next, sued for $6.4 billion on Dec 2, followed by HSBC, sued for $9 billion on Dec 5. The banks have all denied wrongdoing and have pledged to fight the suits.

Picard last week filed the largest suit to date, asking Austrian banker Sonja Kohn and Medici Group for $19.1 billion, alleging that she masterminded a multinational money-laundering business for Madoff.

Picard was appointed by the court in 2008 to unravel the fraud and help victims recover losses. As of December 8, Picard and his law firm, Baker & Hostetler, had approved around 2,000 victim claims totaling $5.8 billion out of the more than 15,000 claims filed. The firm says they will continue to allow claims after the clawback deadline and by the end of the year, the value of the approved claims should soar to $18 billion.

When the fraud was discovered, there were $65 billion in profits on Madoff's books, but Picard estimates total investor losses to be closer to $20 billion. The lawsuits filed to date ask for far more than that, but they include demands for punitive damages, and the expectation that not all suits will be successful.

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Prior to the Picower settlement, Picard had recovered $5.8 billion for victims through asset sales and out-of-court settlements.

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