Non-US investors cheated by Madoff get $15.5 bn from banks

As many as 720,000 investors outside the US, who lost their money to fraudster Bernard L Madoff, have received about $15.5 billion as part of settlements with their banks, a media report said.

Attributing the news to law firms representing the fraud victims, The New York Times said that "about 720,000 investors outside the US who lost money to convicted swindler Bernard L Madoff have settled with their banks, receiving about $15.5 billion in all".

The settlements cover about 80 per cent of the clients represented by the firms, the report said, quoting Madrid law firm Cremades & Calvo-Sotelo's founder Javier Cremades, who helped organise a global alliance of 60 firms a year ago.

The $15.5-billion figure represents, in theory, 100 per cent of the amount clients had invested. But it reportedly excludes -- in almost all cases -- the bogus paper gains that were listed on investor statements.

However, Madoff's US investors are unlikely to see any compensation of a similar nature soon, partly because their investments were made directly with Madoff or through conduits that lack deep pockets, the report added.

The law firms would pursue the matter on behalf of 20 per cent of the clients who are yet to be compensated for their losses.

The report cited Cremades as saying, "Nine institutions have not offered global settlements, though talks are continuing with some firms."

He identified the firms as Switzerland-based Credit Suisse, Vontobel, Mirabaud, Julius Baer, EFG and BBVA, Portugal's Banco Espirito Santo, Dutch ABN Amro and Barclays Spain.

Cremades said that 60 law firms in 25 countries, employing 5,000 lawyers, had received a combined $65 million in fees from settlements so far.

The Madoff fraud totalled $64.8 billion in paper losses, and the alliance estimates that it affected a record three million investors, although there were slightly more than 4,900 active direct accounts shown in the Madoff records available to investigators.

Last June, Madoff was sentenced to 150 years in prison.

Recently, the Madoff trustee said that he has recovered $1.5 billion, which could be used to compensate 2,085 verified claims made by American investors -- totalling $5.45 billion.