The recovery of funds from the Madoff investment scandal has been underway since the scandal broke in December 2008. That month, recovery trustee Irving Picard received funds from the Bank of New York account where Bernard Madoff held new investments into his Ponzi scheme. As it has been concluded that no legitimate investments were made on the investors' behalf for at least the last 12 years of operation, recovery has proceeded on a "money in/money out" basis. Investors are entitled to receive no more than the nominal cash amounts that they paid in and did not subsequently withdraw, without regard to inflation, interest, opportunity cost or the false statements that Madoff provided them. Those statements combined to a total balance of approximately $64 billion, while the admitted claims amount to $20.3 billion.
Madoff provided a confidential list of his assets and those of his firm (BLMIS) to the SEC on December 31, 2008, which was subsequently disclosed on March 13, 2009, in a court filing. Madoff had no Individual Retirement Accounts, no 401(k), no Keogh plan, no other pension plan and no annuities. He owned less than a combined $200,000 in securities in Lehman Brothers, Morgan Stanley, Fidelity Investments, Bear Stearns, and M&T Bank. No offshore or Swiss bank accounts were listed. Madoff assets worth more than $820 million – Newsday.com The SEC withheld further information about the assets to prevent them from being seized by foreign regulators and foreign creditors.
As of March 2026, the trustee had recovered $15.3 billion toward these claims through legal action against Madoff associates, feeder funds and beneficiaries of the scheme, and had made seventeen distributions to investors. Action by the Department of Justice recovered an additional $4.3 billion.
Combined assets Ruth Madoff's combined assets with her husband had a net worth of between $823 million and $826 million. She had $92.6 million in assets listed in her own name: the $7 million penthouse on Manhattan's Upper East Side; an $11 million mansion in Palm Beach, Florida; a three-bedroom apartment in Cap d'Antibes on the French Riviera valued at $1.5 million; $45 million in municipal bonds and $17 million in cash; $8.8 million worth of yachts; and $2.6 million worth of jewelry. The SEC is working with federal prosecutors, who have filed a notice with the Federal Court to seek forfeiture of all listed ill-gotten assets.
On March 17, 2009, prosecutors filed a document listing more assets including $2.6 million in jewelry and about 35 sets of watches and cufflinks, more than $30 million in loans owed to the couple by their late sons, and Ruth Madoff's interest in real estate funds sponsored by Sterling Equities, whose partners include Fred Wilpon. Ruth Madoff, and Peter Madoff, invested as "passive limited partners" in real estate funds sponsored by the company, as well as other venture investments. Assets also include the Madoffs' interest in Hoboken Radiology LLC in Hoboken, New Jersey; Delivery Concepts LLC, an online food ordering service in midtown Manhattan that operates as "delivery.com"; an interest in Madoff La Brea LLC; an interest in the restaurant, P.J. Clarke's on the Hudson LLC; and Boca Raton, Florida-based Viager II LLC.
On March 2, 2009, Judge Louis L. Stanton modified an existing freeze order to surrender assets Madoff owns: his securities firm, real estate, artwork, and entertainment tickets, and granted a request by prosecutors that the existing freeze remain in place for the Manhattan apartment, and vacation homes in Montauk, New York, and Palm Beach, Florida. He has also agreed to surrender his interest in Primex Holdings LLC, a joint venture between Madoff Securities and several large brokerages, designed to replicate the auction process on the New York Stock Exchange. Madoff's April 14, 2009, opening day New York Mets tickets were sold for $7,500 on eBay.
On March 31, 2009, the town of Fairfield, Connecticut, which lost $42 million, was granted a temporary restraining order to freeze and secure all real estate property owned by the Madoffs and the homes of his inner circle in Greenwich, including personal property and financial accounts of Madoff, his relatives and executives with Fairfield Greenwich Group, Maxam Capital and other firms that allegedly fed Madoff's fund, which could allow Fairfield to recover up to $75 million.
On June 25, Madoff agreed to forfeit his share of $170 million of real estate, investments and other assets, with his wife forfeiting $80 million. Ruth Madoff retained $2.5 million as part of the agreement. The assets will be sold by federal marshals.
In Jan 2010, Madoff's Manhattan Penthouse at 133 East 64th Street was sold to Alfred R. Kahn, marketer of the Cabbage Patch Kids dolls, for approx. $8.9m, a million less than the original asking price.
Irving Picard, Trustee The court-appointed trustee for the Madoff Case, Irving Picard, and lawyers from his firm, Baker Hostetler LLP (a Cleveland-based firm which Picard joined the week before he was appointed), are locating assets for distribution to investors. U.S. District Judge Lawrence McKenna gave Picard power to seize assets and records, demand documents, summon witnesses, and enter Madoff's residences around the world, including his Manhattan penthouse.
Claim procedures On January 2, 2009, Picard sent letters to 8,000 potential claimants – advising customers they had until March 2, 2009, and creditors, until July 2, 2009, to place claims.
On February 20, 2009, Picard, at a meeting with Madoff creditors, who include individual investors, banks, charities and others, indicated that his investigation has to date not found any evidence that any securities were purchased on behalf of customers in at least 13 years. It was "cash in and cash out." He identified more than $830 million in liquid assets that may be subject to recovery. David Sheehan, a lawyer working for Picard, indicated: "We are looking at every member of the Madoff family."The Associated Press: Trustee: No evidence Madoff bought any securities
On April 23, 2009, Picard said he would not seek to recover funds from "net losers" in the fraud, referring to those who lost more than they withdrew over time, but those investors must prove it. 223 investors who have a direct personal relationship with the Madoff clan have received letters seeking the return of funds totaling $735 million they redeemed from the Madoff firm as many as six years before the firm collapsed—the time limit allowed under New York law. Known as the legal doctrine of fraudulent conveyance in bankruptcy proceedings means that investors who withdrew their money before the fraud was revealed may be compelled to return their profits or even part of their initial investments. Many of these 223 investors – Madoff's relatives, employees, and their relatives, and those managers who fed billions of dollars of investors' money to him, withdrew funds within the previous 90 days of Madoff's December 10, 2008, arrest.
Seizures and clawbacks
As of May 14, 2009, lawsuits to recover $10.1 billion in fictitious profits had been filed.
On March 16, 2009, a bankruptcy court filing indicated the British enclave of Gibraltar had found $75 million in Madoff assets.
On April 9, 2009, Irving Picard sued Gibraltar-based Banque Jacob Safra in Manhattan Federal Bankruptcy Court seeking $150 million Madoff wired as a "preferential payment" to the bank, invested on behalf of Vizcaya Partners, a British Virgin Islands company. Beginning in 2002, Vizcaya had wired a total of $327 million to Madoff's investment firm through 26 different wire transfers, by the end of October 2008. Coincidentally, Madoff's parents had an investment business called Gibraltar Securities, registered in his mother's name, using their home as the business address. In January 1964, the SEC dropped their investigation when Sylvia agreed to close "her" business.
On March 23, 2009, the bankruptcy trustee disclosed that French authorities were going to seize the French Riviera apartment on behalf of customers allegedly swindled in France. The property, listed in Ruth Madoff's name located in Cap d'Antibes, was worth about $1 million, and contained approximately $900,000 in furnishings.
On April 17, 2009, Picard sued Kingate Management Ltd. for the return of $255 million transferred to it shortly before Madoff Investment's collapse. Beginning in the mid-1990s, feeder funds Kingate Global and Kingate Euro, created by Carlo Grosso, channeled $1.7 billion of his client's money to Madoff. The funds were registered in the British Virgin Islands. The complaint also named Bank of Bermuda Ltd., a unit of HSBC Holdings Plc, as a defendant. The bank wired the money.
On May 7, 2009, Madoff Bankruptcy Trustee, Irving Picard filed a lawsuit against J. Ezra Merkin, seeking to recover almost $500 million withdrawn from Madoff accounts in the prior six years. The complaint alleged that since 1995, Merkin steered more than $1 billion to Madoff through three private hedge funds, Ascot Partners, Ariel Fund, and Gabriel Capital. Since 2002, the funds withdrew at least $494 million from Madoff — returns that Merkin "knew or should have known" were fraudulent. There were at least 500 instances in the prior ten years when his Madoff account statements showed large blocks of stock bought or sold at prices that did not match the stock's trading range for the day when the transactions supposedly occurred. The case number was 08-01789 (BRL): IRVING H. PICARD, Trustee for the Liquidation of Bernard L. Madoff Investment Securities LLC, v. J. EZRA MERKIN. On May 18, 2009, Merkin agreed to New York Attorney General Andrew Cuomo's demands to step down as manager of his hedge funds and place them into receivership.
On May 12, 2009, Picard sued Harley International (Cayman) Ltd., which invested more than $2 billion with Madoff, receiving an average annual return of 13.5%. The lawsuit alleges the Cayman Islands-based fund ignored warning signs that should have alerted it to the fraud. Harley withdrew more than $1 billion from the firm in the two years before its collapse on December 11, 2008, including $425 million in those last three months.
On May 18, 2009, Picard sued Fairfield Greenwich Group, seeking the return of $3.2 billion during the period from 2002 to Madoff's arrest in December 2008. $1.2 billion was withdrawn in the final three months of the fraud. Since 1995, the Fairfield funds invested about $4.5 billion with Bernard L. Madoff Investment Securities LLC, or BLMIS, through 242 wire transfers. The funds are Fairfield Sentry Ltd., Greenwich Sentry LP, and Greenwich Sentry Partners LP. However, the money may already be in the hands of Fairfield's own clients, who are likely off-limits to Picard, since they were not direct investors with Madoff.
On June 22, 2009, Picard filed a claim against Cohmad Securities founder Maurice "Sonny" Cohn, daughter Marcia Cohn, and Robert Jaffe, among more than two dozen individuals and trusts in U.S. Bankruptcy Court in New York. The lawsuit claimed that up to 90 percent of Cohmad's income came from referring clients and that the firm had a "symbiotic" relationship with Madoff, having earned hundreds of millions of dollars from the fraud. The lawsuit sought more than $100 million paid to Cohmad six years prior to Madoff's firm declaring bankruptcy, and more than $105 million in profits Cohmad employees and their families withdrew from the investment accounts they held with Madoff. The case is Picard v. Cohmad Securities Corp., 09-AP-1305, U.S. Bankruptcy Court, Southern District of New York (Manhattan).