Funds lack­ing for Mad­off vic­tims

Los Angeles Times - - Company Town -

Claims by vic­tims of Bernard Mad­off’s Ponzi scheme are far in ex­cess of funds avail­able to the Se­cu­ri­ties In­vestor Pro­tec­tion Corp. to re­im­burse them, the agency said in a let­ter to a con­gres­sional sub­com­mit­tee.

As of Aug. 1, the SIPC had a to­tal fund of $1.2 bil­lion and ac­cess to as much as an ad­di­tional $2.5 bil­lion in loans from the Se­cu­ri­ties and Ex­change Com­mis­sion, SIPC Pres­i­dent Stephen Har­beck said in a Sept. 7 let­ter to the House Sub­com­mit­tee on Cap­i­tal Mar­kets, In­surance and Govern­ment Spon­sored En­ter­prises.

SIPC, which is re­quired to pay vic­tims a max­i­mum of $500,000 for most claims, has al­lo­cated $888 mil­lion to pay claims based on lost prin­ci­pal. If forced to pay based on the ac­count state­ments, the SIPC would have to pay an ad­di­tional $1.1 bil­lion, it said in the let­ter.

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