LAWYERS are reaping millions in fees from the financial devastation caused in the collapse of Bernard Madoff’s $50bn (£31bn) Ponzi scheme which paid investors purported returns from funds deposited by new investors.
The Securities Investor Protection Corp (SIPC), an industry-sponsored organisation that provides financial protection to investors, said yesterday it has paid more than $290m to law firms and consultants since Madoff’s scheme fell apart in 2008. This is in addition to the $790m the SIPC is paying to victims of Madoff’s fraud.
The lawyers and consultants are tasked with tracking down Madoff’s stolen assets so they can be distributed back to the victims of his scam.
This includes fees of nearly $128m for Baker & Hostetler, the law firm that is spearheading the recovery of stolen property. The firm’s Irving Picard, appointed as trustee by the federal bankruptcy court overseeing the case, is being paid an additional $3.2m. SIPC said it has paid another $10m to additional law firms “around the world.” In addition, the organisation has paid nearly $150m to consultants, including $84m to FTI Consulting, $48m to AlixPartners, $2.5m to Renaissance Associates and about $10m to others.