Madoff trustee spent $26.9 mln to recover $849,000 in Q2, Q3

* Trustee’s Q2, Q3 expenses outweigh recoveries
* Biggest chunk of fee goes to trustee’s law firm
* About $1.5 billion has been recovered so far for victims

By Ernest Scheyder

NEW YORK, Oct 31 (BestGrowthStock) – A trustee overseeing the
bankruptcy of Bernard Madoff’s investment firm spent $26.9
million in the second and third quarters to recover $849,000
for Madoff’s victims, according to a federal court filing.

Irving Picard, the trustee, said in a filing with Manhattan
federal court that much of the expense — $15.8 million —
went to cover fees for his law firm, Baker & Hostetler LLP.

Picard said his “ability to call on the resources of Baker
& Hostetler in such areas as corporate, real estate,
bankruptcy, securities, employment, tax, banking and
litigation has been of material assistance.”

Since beginning the task of weeding through the aftermath
of Madoff’s Ponzi scheme, Picard has recovered about $1.5
billion for victims through Sept. 30, the filing said.

About 14,030 claims had been reviewed as of Oct. 22, with
2,280 approved for payment, the filing said.

Besides the law firm expense during the second and third
quarters, Picard spent $7.1 million on consultants and
$107,560 on “hosting expenses,” according to the filing.

Most of the $849,000 recovered for victims of Madoff’s
Ponzi scheme came from investors who received preferential
payouts ahead of the bankruptcy of Madoff’s firm, the filing
said.

A portion of the amount recovered — $71,158 — came from
interest and dividends on various bank accounts.

Bernard Madoff was arrested and charged in December 2008
when his sons, according to their lawyers, reported him to
authorities after he confessed to running a massive $50
billion dollar Ponzi scheme.

A Ponzi scheme is one in which early investors are paid
with money deposited by new clients.

Madoff, 72, pleaded guilty in March 2009 and is serving a
150-year prison sentence.
(Reporting by Ernest Scheyder; Editing by Jan Paschal)

Madoff trustee spent $26.9 mln to recover $849,000 in Q2, Q3