Some Madoff victims may qualify for faster settlements

— -- The court trustee seeking Bernard Madoff's assets to repay clients burned by the disgraced financier's scam has launched a hardship program in an effort to speed payments to victims.

Individual victims having trouble making ends meet will be required to file a special claim by July 2 seeking an accelerated federal insurance payment, trustee Irving Picard announced Friday.

Applicants may qualify for up to $500,000, said Picard, whose hardship program guidelines bar requests from feeder funds and other businesses that channeled investors' money to Madoff.

The trustee will assess the requests based on financial indicators such as inability to pay for basic living expenses or medical bills, personal bankruptcy declarations or a need to return to work at age 65 or older.

Many former Madoff clients lost their life savings to his multibillion-dollar Ponzi scheme, forcing them to sell homes and remaining assets, seek shelter with relatives and look for jobs after years of retirement.

The trustee plans to notify applicants whether they qualify for the program within 20 days after filing. Picard said the trustee staff would "endeavor" to mail a determination of claims within 20 days after qualification decisions are reached on individual applications. But he cautioned that some applications could take longer because Madoff's financial records are incomplete.

The federal Securities Investor Protection Corporation, which insures clients of failed brokerages, provides up to $500,000 per investor, based on how much they lost.

Picard has so far recovered roughly $1 billion in Madoff assets that will ultimately be distributed to victimized investors on a pro rata basis. The trustee is suing several Madoff feeder funds in an effort to recover hundreds of millions in additional funds.

Madoff pleaded guilty in March to heading a decades-long scam that victimized charities, celebrities, hedge funds, retirement plans and average investors worldwide. He faces a maximum 150-year federal prison term at a sentencing hearing set for next month.